A senior banker told London's High Court of the incredulity of parents and friends at the decision by Commerzbank AG, Germany's second largest lender, to break a pledge to pay 52 million euros (44 million pounds) in bonuses for 2008.
When you spoke to people outside the market, especially parents, there was a certain amount of incredulity about what was going on, said Steven Garrett, one of 104 former Dresdner bankers suing parent Commerzbank in a rare group action in the investment banking industry.
Mostly they were saying to me: 'Steve, this must be some kind of mistake. You've got to stick it out (and) battle it out from the inside', Garrett, former head of interest rate options at Dresdner, told the court on Wednesday.
The London-based bankers, whose claims range from around 15,000 euros to 2.6 million, launched their legal battle in late 2009 after some were paid only 10 percent of the discretionary bonuses they were promised for 2008 out of a guaranteed minimum bonus pool of 400 million euros.
The high-profile battle, which comes at a time of increasing public anger at bank bonuses, hinges on whether promises made to bankers are legally binding, and whether Commerzbank was entitled to make awards dependent on bank performance after acquiring Dresdner in 2009 -- and subsequently slashing some bonuses.
Commerzbank Chief Executive Martin Blessing, who was cross-examined on Monday and Tuesday, conceded the company had broken the promise to bankers. But he said it had been the right decision as the financial crises sapped the strength of banks after the collapse of Lehman Brothers.
Commerzbank twice had to go cap in hand to the German government for a bailout, under the terms of which Blessing's basic salary has been capped at 500,000 euros since 2009 -- although pension contributions and company benefits pushed it up to nearly 800,000 in 2009 and 900,000 in 2010.
Garrett, who was paid 120,000 pounds ($189,400) in 2008, said he was expecting a bonus of 1.6 million euros but got only 160,000.
I was obviously very disappointed not to have been paid, he said, sitting with his hands clasped under the table.
Asked how he interpreted the words of Stefan Jentzsch, the former Dresdner investment bank head who set up the bonus pool at a time when the Financial Services Authority was also concerned about a destabilising staff exodus, he said:
He was basically saying: 'You can stick it out here ... get your nose down, keep working, keep pushing ... and those that perform well will do well', he said.
But when he wanted to watch the meetings broadcast over the intranet again, he was told by the internal communications department the recordings had been deleted.
Garrett said he believed that deleting such files breached regulatory and compliance requirements, but was told that if he continued such claims he would be reported for harassment, he told the court.
Jentzsch takes the stand next Monday as a witness for the claimants.
(Additional reporting by Alexander Huebner in Frankfurt; Writing by Kirstin Ridley; Editing by David Holmes)