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Yesterday at Deutsche Bank: “Bonus were slashed by €1.95 million over [...] ‘unacceptable’ migration problems.”

FinExtra writes this and explains that a data migration project is the reason. Financial Times calls it an “IT fiasco” and adds “Deutsche Bank slashed cash bonuses of senior executives by up to 50 per cent in the wake of a botched IT project that caused chaos for German retail clients and attracted a rebuke from banking watchdog BaFin.”  

What exactly happened? Transferring 12 million clients and 50 billion data records from German Postbank into the IT systems of acquiring Deutsche Bank failed. Besides its immense scale, the project and its predecessor, the Magellan Project, posed an enduring challenge since 2010. Costs exceeded one billion euros but only led to substantial dissatisfaction of customers.

The bonus cuts came “after Deutsche Bank faced a wave of client complaints last year on the back of a database transfer from one unit to another”, as Bloomberg writes on the same topic, adding that “the former management board member overseeing the unit where the data transfer took place, saw his short-term bonus cut in half because of the botched project.”

What can we learn from that? Software migration can be very strategic. Getting data migration right is crucial not only towards customers at large but also for regulatory authorities and top management.

You can read more about this in the quoted articles:  

Deutsche Bank cuts bonuses over botched Postbank IT integration – FinExtra

Deutsche Bank cuts cash bonuses by up to 50% over Postbank IT fiasco – Financial Times

Deutsche Bank Reduces Bonus Pool After Decline in Trading – BNN Bloomberg

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