Senior heads set to roll at Morgan

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The Independent Online
Morgan Grenfell's internal report on the scandal created by Peter Young, the sacked fund manager, is expected to be delivered next week, provoking a round of firings at senior level.

The findings are expected to lead to job losses within the bank's asset management division. Up to seven executives are thought to be in the firing line, the most senior being Keith Percy, chief executive of Morgan Grenfell Asset Management.

Some institutions have warned that they may take their business elsewhere if he is forced to carry the can over the affair, which has cost Morgan Grenfell's parent company Deutsche Bank at least pounds 180m.

Deutsche Morgan Grenfell's chief executive, Michael Dobson, is also thought to be among those who want Mr Percy to stay. However, his bosses in Frankfurt may insist that he goes since he was the manager in charge of Mr Young in London.

Other institutions have warned they will take their business away if he stays, believing he should take responsibility for Mr Young's antics. "It's a tough decision," said one City source.

Glyn Owen, chief investment officer of European investments, is also cited as a possible candidate, as is Grahame Kane, chief executive of Morgan Grenfell Unit Trusts, even though he is likely to argue that his main role was in marketing and sales and not managing Mr Young.

The findings of the internal report, in the final stages of completion, may not be released until they have been discussed by Deutsche Bank's board, which meets every Tuesday, even though the decisions are ultimately expected to be made in London.

It may also contain details of any internal reorganistions to improve internal controls at the asset management operation, which has prompted anger from Frankfurt where Deutsche Bank is based.

Rolf Breuer, the member of Deutsche Bank's management board with overall responsibility for asset management, may want to take a firmer control of parts of Morgan Grenfell, which is currently run by Mr Dobson.

The affair, on which the Serious Fraud Office has opened a case, is highly embarrassing for the firm, and has prompted some speculation that the unit trust operation may go to the lengths of changing its brand name.

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