Last year, Commerzbank, whose largest shareholder is the German state with 15.6 percent, returned to profitability.
(Photo: dpa)
Frankfurt Commerzbank wants to successively expand its offering in the crypto business. There is increasing customer demand for digital assets, said CEO Manfred Knof on Wednesday at the digital general meeting. The institute wants to develop secure and regulatory-compliant solutions for its customers in this area.
“Building on the service of custody of cryptocurrencies, further services are to be offered step by step,” said Knof. IT security is of great importance. Although the crypto markets are currently collapsing, many other banks are currently considering whether and in what form they want to offer their customers crypto assets.
Commerzbank private customer board member Thomas Schaufler recently announced in an interview with the Handelsblatt that the money house wants to keep cryptoassets for institutional customers from the summer. Such an offer is only conceivable for private customers when “the area is better regulated and there is more clarity on the subject of consumer protection”.
At the Annual General Meeting, the majority of shareholders voted in favor of the motions of the Board of Management and the Supervisory Board. When voting on the new remuneration system, however, approval was only 85 percent, and the remuneration report was only just under 60 percent.
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The fund company Union Investment rejected both applications. From their point of view, the management board remuneration system has been improved, but is still “comparatively imprecisely formulated”. In the remuneration report, Union Investment misses, among other things, a clear separation between short-term and long-term variable remuneration.
In the run-up to the Annual General Meeting, the influential voting rights advisor ISS spoke out against the approval of the remuneration report – among other things because of a special payment of one million euros for CEO Knof. There is no “convincing justification” for this in the remuneration report.
Many banks are currently considering the form in which they want to offer their customers cryptoassets.
(Photo: dpa)
In addition, ISS complained that IT director Jörg Hessenmüller, who left last autumn, received a severance payment worth millions, “although it seems as if the initiative to resign came from him.”
No claims for damages against ex-board members
Commerzbank initially extended Hessenmüller’s contract by five years in June 2021 – but then canceled it again in the fall. The reason: According to insiders, Hessenmüller had not sufficiently informed the supervisory board in advance about serious problems with the planned outsourcing of securities processing to HSBC. The “Project Sirius” was stopped shortly afterwards, which cost Commerzbank more than 200 million euros.
“Following the completion of Project Sirius, Jörg Hessenmüller proposed to the supervisory board that his employment relationship be terminated,” said Chief Inspector Helmut Gottschalk. The supervisory board then agreed with Hessenmüller on a mutual termination of the employment relationship and on a compensation payment of 1.98 million euros. A dismissal for important reasons was not legally possible.
In a counter-motion, shareholder Bernd Heckmann criticized that all board members were already aware at the beginning of 2020 that the project had gotten out of hand. However, they failed to meet their obligation to intervene.
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Vice boss Bettina Orlopp presents the situation differently. After the first sub-processes were outsourced to HSBC at the beginning of 2021, “various problems with a direct impact on Commerzbank customers” arose, she said. The board then reassessed the overall situation.
“In order to be able to continue the project, further high investments would have been necessary with a noticeable further delay in outsourcing,” explained Orlopp. For this reason, the Management Board decided not to pursue the outsourcing any further. As a result, Commerzbank had to pay a contractual penalty, the amount of which Orlopp did not want to comment on, citing a “confidentiality obligation agreed with HSBC”.
According to financial circles, Commerzbank has reduced the bonus payments for Hessenmüller and his predecessor Frank Annuscheit because of the failed outsourcing. However, after a review by an external expert, the bank does not want to sue the two ex-board members for damages.
“On the basis of the lawyer’s recommendation, after intensive discussion, the supervisory board decided not to assert any claims for damages against current and former members of the board of directors due to the lack of a predominant probability of success,” said chief controller Gottschalk.
More: The uncomfortable Mr. Gottschalk: the head of the supervisory board confronts Commerzbank with a new world