Deutsche Bank AG employees may owe their cash bonuses for 2016, however modest, to a last-minute bargain by Chief Executive Officer John Cryan.

The beleaguered German bank, long embroiled in negotiations with the US Justice Department, was inching closer in recent weeks to a resolution over its sale of defective residential mortgage-backed securities that fueled the global financial crisis.

Deutsche Bank had no desire for a drawn-out court fight. Around the same time prosecutors filed a lawsuit against Barclays on Thursday, Deutsche Bank's lawyers said a holiday deal seemed possible.

Cryan pounced, according to someone close to the talks. The bank agreed to pay just $3.1 billion in cash to resolve the case and $4.1 billion in remediation to homeowners.

It's a victory for a firm that had faced an opening gambit from prosecutors of $14 billion, and for the CEO, who's been hamstrung by myriad regulatory problems in the US and abroad. The cash penalty is well within the range the bank had anticipated, easing concerns about capital pressure.

Resolution of the case before Saturday may enable Deutsche Bank to set aside money for bonuses, a relief for a firm that has struggled to keep its best employees. In recent months, executives had contemplated replacing cash bonuses with stock.

Bloomberg