Deutsche clampdown on bad behavior prompts exodus of traders: FT
(Reuters) - Senior bankers at Deutsche Bank AG (DBKGn.DE: Quote) are leaving the bank amid a crackdown on bad behavior by traders, as the bank undergoes a probe by global regulators into allegations of attempts to rig markets, the Financial Times reported on Sunday.
The bank is planning to stop rewarding the best earners on the trading floor with bonuses or promotions if they are "disruptive" or are not seen as team players, the newspaper said. (on.ft.com/1D5hsFV)
These bankers are drifting away from traditional banking to less regulated areas like hedge fund management and boutique firms, the newspaper said.
Deutsche Bank has been facing a set of investigations by regulators involving allegations that benchmark interest rates were manipulated and that some investors were unfairly favored in off-market trading venues known as dark pools.
The newspaper reported that other banks like Barclays (BARC.L: Quote) are also in the process of introducing similar measures, after its bonus culture was cited as one of the factors that led to the Libor manipulation rate scandal.
Barclays is introducing a company-wide bonus policy this year for bankers who stick to the British bank's values and behavioral guidelines.
Barclays, which is also being investigated over the Libor case, recently agreed to pay $20 million to settle a U.S class action suit.
The newspaper said that senior bankers are now operating in a much tighter environment, with an emphasis on following non-binding ethical codes along with the rules.
Regulators have sued around 16 banks, including Barclays and UBS, for rigging the Libor rate. Continued...