DEUTSCHE Bank is winning market share to combat falling margins in its key investment banking arm and is confident of its ambitious 2011 profit target, top bosses said yesterday.
The bank also revealed an average investment banker pay of over $500,000 (£309,000) each last year, a bigger bonanza than that enjoyed by employees of the largest Wall Street player Goldman Sachs.
Profits from trading and underwriting deals accounted for 88 per cent of Deutsche’s profits in the fourth quarter, and as regulation squeezes margins, market share has become key.
The bank expects growth outside investment banking to reduce that contribution to 50 per cent over the next three years.
“Our confidence that we can achieve this (€10bn 2011 profit) target stems from the fact that we not only made provisions for the future in 2010, but we also set new records and captured market share in many businesses,” said chief executive Josef Ackermann. Anshu Jain, head of the investment banking division and front-runner to take over from Ackermann when he retires in 2013, said the market share was now the key issue.
The bank packed a raft of restructuring charges into its 2010 figures earlier this week and missed expectations by a big margin.
Yesterday Ackermann said the bank remained on track to deliver pre-tax profit of €10bn in 2011.
City A.M. Reporter