Deutsche Bank raises pay for juniors to keep up with rivals

[NEW YORK] Deutsche Bank is boosting the amount it pays investment-banking analysts as Wall Street contends with record deal flow and its impact on its most junior workers.

The firm will now pay first- and second-year analysts in its origination and advisory arms US$100,000 and US$105,000, respectively, according to a person with knowledge of the matter who asked not to be named discussing personnel information. That's a US$15,000 increase from previous amounts and puts the German bank in line with recent hikes at its competitors.

US analysts who are being promoted to the associate level mid-year will see their pay increase by US$25,000 to US$150,000, the person said. Globally, analysts and those being promoted to associate will see their compensation increase by a similar percentage.

A Deutsche Bank spokesman declined to comment.

The move means Deutsche Bank is joining rivals including Citigroup and Barclays in increasing pay for its youngest employees, many of whom have borne the brunt of record deal flow and capital-markets activity in the past year. For many, that translated to long hours working from home during Covid-19 lockdowns.

Deutsche Bank chief executive officer Christian Sewing is homing in on the final stretch of a deep turnaround effort that's come to increasingly depend on investment-bank profits.

He's seeking to retain talent in that unit by keeping compensation aligned with competitors while still trying to achieve an ambitious cost target next year. Unexpected expenses have cropped up recently, creating significant headwinds for reaching that goal.

Germany's largest lender expects revenue at its investment bank to hit last year's level despite a slowdown in the trading momentum. It reports second-quarter earnings on July 28.

The pay adjustments will be shared during mid-year compensation reviews, according to the person. While formal communication won't take place until next month, the changes will be effective July 1.

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