The members of the Board of Management have direct pension commitments on the basis of their individual contracts, providing for benefits in case of permanent disability, death or retirement. If the contract of a member ends after at least five years of service on the Board of Management, the entitlements he has acquired will vest. Members become entitled to benefits due to permanent disability after at least five years of service. Eligibility for retirement benefits begins at the earliest at the age of 55, or 60 years of age in the case of John P. Mullen and 62 years of age for Jürgen Gerdes. The members of the Board of Management can choose between ongoing pension payments and a lump sum. The amount of benefits depends on the pensionable income and the number of years of service.
Pensionable income consists of the annual basic salary based on the average salary of the last twelve months of employment. Members of the Board of Management appointed for the first time after 2001 attain a pension level of 25% after five years of service on the Board of Management. The maximum pension level (50%) is attained after ten years of service. The maximum pension levels of members of the Board of Management appointed before 2002 are 60% and 75% respectively. The graduated increase in the pension level based on individual contractual arrangements depends either on the period of service or the periods of appointment on the Board of Management. Subsequent pension benefits will be adjusted (increased or decreased) to reflect changes in the consumer price index in Germany.
Pension commitments: individual breakdown
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Pension commitments for the Board of Management |
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Pension commitments | ||||||||||||||||||
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Pension level on December 31, 2006 |
Maximum pension level |
Service cost for the pension obligation | ||||||||||||||||
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% |
% |
€ | ||||||||||||||||
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Dr Klaus Zumwinkel, Chairman |
75 |
75 |
01) | ||||||||||||||||
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25 |
50 |
334,558 | |||||||||||||||||
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Prof. Dr Edgar Ernst2) |
75 |
75 |
566,584 | ||||||||||||||||
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Jürgen Gerdes3),4) |
0 |
50 |
76,011 | ||||||||||||||||
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Dr Wolfgang Klein3),5) |
60 |
60 |
184,414 | ||||||||||||||||
|
35 |
50 |
652,498 | |||||||||||||||||
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Dr Hans-Dieter Petram6) |
|
75 |
01) | ||||||||||||||||
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30 |
60 |
627,516 | |||||||||||||||||
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Prof. Dr Wulf von Schimmelmann5),6) |
|
75 |
1,623,938 | ||||||||||||||||
The pension commitment made to Dr Wolfgang Klein relates to his function as chairman of the Management Board of Deutsche Postbank AG and is therefore owed in its entirety by Deutsche Postbank AG. The commitment therefore varies in certain respects from the arrangements discussed above at Deutsche Post AG; the basic structure is, however, identical. The benefit amount depends on the pensionable income and the pension level derived from the years of service. Dr Wolfgang Klein has already attained the maximum pension level of 60%. According to his contract, retirement benefits are generally paid from the age of 62 or, if the employment contract is not renewed, after reaching the age of 55. A bridge allowance will be paid for a two-year period in addition to the retirement benefits if he leaves the employ of the company upon reaching the age limit of 62 or due to permanent disability. Subsequent adjustments of the retirement benefits will be based on the percentage change in the highest pay scale group in the collective agreement covering the Association of German Public Sector Banks.
Upon his appointment to the Board of Management, John Allan was not included in the pension scheme for members of the Board of Management. Due to his past contractual relationship with Exel, he will receive a taxable annual lump-sum payment of €363,017, in addition to the remuneration paid, that he can use to secure his own pension coverage. This amount is contained in the individual breakdown of fringe benefits.
The remuneration of former members of the Board of Management or their surviving dependants amounted to €13.58 million. The defined benefit obligations (DBOs) for current pensions calculated under IFRSs amount to €27.0 million.
