The head of the German bank which refused to pay massive promised bonuses to London bankers after the financial crisis triggered huge losses yesterday declared that he "behaved honourably".
Martin Blessing, chief executive of Commerzbank and one of the most senior bankers in Europe, was giving evidence in a High Court case brought against his bank by more than 100 former Dresdner Kleinwort employees.
They claim Commerzbank reneged on a promise of a €400m bonus pot when it took over their company in 2009. The pledge would have paid up to £1.5m each to some bankers.
For the 2008 year, Dresdner's investment bank made record losses.
Blessing, 48, declared: "From my point of view, I behaved honourably. but from their point of view, I probably disappointed them."
The case is being closely watched at a time when bankers' bonuses are more in the spotlight than at any point since the Lehman Brothers collapse.
The issue is complicated by the fact that the promise was made by bosses at Dresdner bank before it was taken over by Commerzbank.
Mr Blessing said he had discussed the bonus pledge with Dresdner management prior to the takeover. "I stated, 'I don't like this thing.'"
Mr Blessing added that cutting bonuses was the "right thing to do" in the light of the losses brought about by the financial crisis.
"Something wasn't working properly," he said of Dresdner's huge losses in 2007 and 2008. " Too much risk was being taken there."
QC for 21 of the complainants, Andrew Hochhauser, cast doubt on Mr Blessing's version: "You have presented a distorted and an incomplete picture of events," he said.
Commerzbank argues that the pledges made by the bankers' previous employer were not binding.
The promise was made by the then boss of Dresdner's investment bank, Stefan Jentzsch, who will be in court later on in the trial.