Dresdner sued by more ex-staff in payout dispute
Investment bank's parent refuses to make payouts after huge Dresdner losses
Friday 28 August 2009
Three former managers at Dresdner Kleinwort, including the head of M&A in the UK, have become the latest to sue the investment bank to recover unpaid bonuses and severance pay worth €11m (£9.7m).
John McIntyre, Bertrand Pinel and Alberto Piedra have filed suits in London after Dresdner Kleinwort's new parent company, Commerzbank, refused to pay the contracted compensation.
Mr McIntyre, who has worked with the property mogul Robert Tchenguiz and Paul Taylor, the man who put together the Qatari bid for J Sainsbury in 2007, is seeking payment of his £1.3m guaranteed bonus and severance of £743,000.
Mr Pinel, ex-head of global finance and an employee of Dresdner Kleinwort for almost 16 years, says in the suit he is owed a €2.25m bonus and €3.2m in severance. Former head of global banking Bert Piedra is seeking a €3m bonus.
A spokeswoman for Commerzbank said: "Given the huge losses at Dresdner Kleinwort last year, Commerzbank objected to the bonus and severance claims of the former Dresdner Kleinwort senior management. We continue to contest these arrangements."
Four others from the bank's former senior management team have taken Commerzbank to court and won £10.8m this month. Mr Justice Jack said the German bank had to abide by contract law, adding it had "no defence".
The 15-strong management executive committee of Dresdner Kleinwort, including the chief executive, Stefan Jentzsch, stood down after the German retail bank Commerzbank bought its parent, Dresdner Bank, in January. Commerzbank refused to pay compensation, criticising the extreme losses at Dresdner Kleinwort, and invoked a clawback clause in most contracts. None of the executive managers had that clause, yet Commerzbank still refused to pay. More lawsuits are expected.
The issue of investment banking compensation is a political hot potato in Germany, and this week Chancellor Angela Merkel supported calls to limit banking bonuses. It is a particular sore point for Commerzbank, which was part-nationalised shortly after the deal.
Dresdner Kleinwort has had its UK operations slashed since Commerzbank agreed to buy Deutsche Bank in a deal worth almost €10bn. The workforce is expected to fall from 3,300 to between 1,200 and 1,500. One former employee said: "It was just awful. Everything was poorly communicated, over the job cuts and bonuses. When they didn't pay it, the trust broke down and it became a case of how quickly people could get out. The staff was massively demotivated."
Bonuses and pay-offs claimed by ex-Dresdner managers.
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