Deutsche Bank Investors Advised Not to Rubber-Stamp Board

Deutsche Bank AG investors shouldn’t rubber-stamp the decisions made by the German lender’s management including co-Chief Executive Officer John Cryan, according to a British shareholder advisory firm.

Shareholders should also oppose the actions of the supervisory board and not sign off on the bank’s executive remuneration policy, Pensions & Investment Research Consultants Ltd. said in non-binding recommendations published on Friday. Deutsche Bank, led by Cryan and Juergen Fitschen, is scheduled to hold its annual shareholder meeting in Frankfurt next month.

The bank hasn’t shown “consistent success” in raising its capital ratios and needs to provide transparency on legal risks and how it plans to improve controls, the advisory firm said. There are also “concerns over the capacity of the supervisory board to effectively supervise the management of the company.”

Deutsche Bank swapped out its top management last year as part of Cryan’s wider overhaul to reduce the lender’s dependence on costly debt-trading businesses and fix controls that failed to prevent a raft of legal expenses. The shares have dropped about 26 percent this year, with the bank seen slipping into a loss of 484.3 million euros ($548 million) in the first quarter, according to estimates compiled by Bloomberg.

PIRC recommended opposing the appointment of KPMG as auditors and said investors should abstain from voting on approving a settlement with former Chief Executive Rolf Breuer and insurers over damages related to a lawsuit filed by a German media entrepreneur.

A spokesman at Deutsche Bank in London declined to comment.

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