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Deutsche Bank and union reach pay deal for Postbank employees

Published 02/05/2024, 10:31
Updated 02/05/2024, 15:16
© Reuters. FILE PHOTO: The logo of Deutsche Bank is seen in Brussels, Belgium December 6, 2022. REUTERS/Yves Herman/File Photo

FRANKFURT (Reuters) -Deutsche Bank's management has reached a pay deal with unions for thousands of workers at its Postbank division, putting an end to months of wrangling, both parties said on Thursday.

The bank will pay employees 11.5% more in a two-step raise, they said. That is less than the 15.5% unions had been demanding, but in return, Deutsche Bank (ETR:DBKGn) agreed to rule out forced layoffs through December 2027.

The agreement clears up one of several hurdles facing Germany's largest lender at its Postbank brand.

Deutsche recently disclosed it could be on the hook for up to 1.3 billion euros ($1.39 billion) in a long-running lawsuit filed by former Postbank shareholders claiming it underpaid for its purchase of Postbank during the financial crisis.

Deutsche has also been grappling with customer service problems at Postbank, resulting in the bank's regulator overseeing a clean-up and cuts in bonuses for some of Deutsche's top managers.

Deutsche Bank has already factored the pay deal into its financial planning and it doesn't alter the bank's commitment to its costs targets, a spokesperson said.

© Reuters. FILE PHOTO: A Postbank sign is seen in Munich, Germany, August 1, 2017. REUTERS/Michaela Rehle/File Photo

Jan Duscheck, chief negotiator in the talks for the Verdi labour union and a member of Deutsche's supervisory board, said the deal gives employees long-term job security.

($1 = 0.9349 euros)

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