High Court Judge Slams Commerzbank Over Bankers' Bonuses

Commerzbank, Germany's second-largest lender, will have to pay 104 London-based bankers €52mn in bonuses, plus interest, after losing its appeal against the ruling in Britain's High Court.

The ruling also adds a 5 percent above base rates interest on the bonus payments.

London's High Court Judge Robert Owen added that he thought Commerzbank had acted in a "highly reprehensible" manner and "was unreasonable to the high degree that warrants an order for indemnity costs".

Commerzbank stated that it was considering whether to petition the Court of Appeal.

At the beginning of this month, Judge Owen ordered the Frankfurt-based bank, which received more than €18bn in German taxpayer support to prevent its collapse in 2008, to pay bonuses guaranteed by its former investment banking unit, Dresdner Kleinwort, the very same year.

The bankers claimed the promise, made by Dresdner's former CEO Stefan Jentzsch, to pay bonus and incentive payments were legally binding and that Commerzbank's decision not to honour the agreements earlier this year amounted to a breach of contract. Commerzbank argued it was justified in rescinding the payments due to the massive scale of losses at Dresdner, which amounted to more than €6bn in 2008.