Loyalty bonuses fail to hold DKB staff

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The Independent Online

Dresdner Kleinwort Benson, the City investment banking arm of Germany's Dresdner Bank has been hit by more defections just days after the payment of $410m (£273m) loyalty bonuses.

Dresdner Kleinwort Benson, the City investment banking arm of Germany's Dresdner Bank has been hit by more defections just days after the payment of $410m (£273m) loyalty bonuses.

Eleven senior staff from the bank's fixed income division are understood to have quit since bonuses were paid last Monday - taking to 200 the total who have left the bank since April when staff morale was badly shaken by the way senior management handled the abortive merger negotiations with rival Deutsche Bank.

The firm continues to be buffeted by uncertainty with Dresdner's shares jumping 3.2 euros to 53.25 yesterday amid talk that the bank faces a likely break-up bid following the collapse of merger talks with Commerzbank last week.

The guaranteed bonus scheme was put in place following the breakdown of Deutsche merger talks in April expressly in order to stop the investment bank disintegrating in the wake of the collapse.

The most senior of those departing in the latest exodus is Peter Brooks, head of European bond trading who is joining Merrill Lynch. Max Grasiosi, head of Italian bond sales is going to Canadian Imperial Bank of Commerce.

DKB said it could not confirm in detail the latest defections.

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