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British bankers top bonus list, according to EU financial watchdog British bankers top bonus list, according to EU financial watchdog
(35 minutes later)
More than 2,000 City financiers took home more than £730,000 (€1m) in 2013, according to the EU banking regulator. One was handed more than £13m.More than 2,000 City financiers took home more than £730,000 (€1m) in 2013, according to the EU banking regulator. One was handed more than £13m.
The European Banking Authority said more bankers in the UK received at least €1m than in the rest of the EU combined.The European Banking Authority said more bankers in the UK received at least €1m than in the rest of the EU combined.
The regulator’s data from across the EU showed 3,178 bankers were paid more than €1m, of whom 2,086 were based in the UK. The total had fallen from 3,530 in total in 2012, with 2,714 of them in Britain – although this was due in part to the pound having weakened against the euro, with UK bankers paid in sterling.The regulator’s data from across the EU showed 3,178 bankers were paid more than €1m, of whom 2,086 were based in the UK. The total had fallen from 3,530 in total in 2012, with 2,714 of them in Britain – although this was due in part to the pound having weakened against the euro, with UK bankers paid in sterling.
For the first time, the EBA published more detail about the scale of the pay deals on offer, building on disclosures that began in 2008, when the financial crisis led to clamour for more information about bankers’ pay.For the first time, the EBA published more detail about the scale of the pay deals on offer, building on disclosures that began in 2008, when the financial crisis led to clamour for more information about bankers’ pay.
The EBA published pay in brackets starting at €1m. Of the 2,086 in the UK classified as high earners, 1,470 were in the pay bracket of between €1m – €2m. Nine received more than €10m and one was handed €18.3m. The EBA published pay in brackets starting at €1m. Of the 2,086 in the UK classified as high earners, 1,470 had salaries of between €1m – €2m. Nine received more than €10m and one was handed €18.3m.
The EBA also published data about all employees of EU institutions regardless of where they were based, capturing employees in the US and Asia. Under this measure 1,126 of the high earners were in the the bracket between €1m – €1.5m and another 535 in the bracket between €1.5m – €2m. The EBA also published data about all employees of EU institutions regardless of where they were based, capturing employees in the US and Asia. Under this measure, 1,126 of the high earners were in the the bracket between €1m – €1.5m and another 535 between €1.5m – €2m.
Some 39 received €5m or more. This measure showed that one banker outside the EU was in the €19m – €20m bracket. Thirty-nine bankers received €5m or more. This measure showed that one outside the EU was in the €19m – €20m bracket.
While the average in the UK was €2m, there were bigger averages in Cyprus, Finland, Spain and Portugal where there were fewer bankers falling under the remit of the EBA survey. While the average in the UK was €2m, there were bigger averages in Cyprus, Finland, Spain and Portugal, where there were fewer bankers falling under the remit of the EBA survey.
The data covers the last year before the EU cap was introduced, which has limited bonuses to at most double a banker’s salary, if shareholders give specific approval, and shows the impact the ceiling has had on bankers in London. The ratio of bonuses to salaries in 2013 was 410% in the UK while the average across the EU was 104%.The data covers the last year before the EU cap was introduced, which has limited bonuses to at most double a banker’s salary, if shareholders give specific approval, and shows the impact the ceiling has had on bankers in London. The ratio of bonuses to salaries in 2013 was 410% in the UK while the average across the EU was 104%.
“In some cases the ratio was further increased in 2013, rather than lowered as might have been expected, to phase in the application of the bonus cap for remuneration awarded for the performance year 2014 and onwards,” the EBA said.“In some cases the ratio was further increased in 2013, rather than lowered as might have been expected, to phase in the application of the bonus cap for remuneration awarded for the performance year 2014 and onwards,” the EBA said.
The EBA has already warned banks that it is on alert for attempts to sidestep the cap by introducing separate payments such as “role-based pay” alongside salaries and bonuses to prevent pay from falling. It is currently working on new guidelines to tackle this area. The EBA has already warned banks that it is on alert for attempts to sidestep the cap by introducing separate payments such as “role-based pay” alongside salaries and bonuses to prevent pay from falling. It is working on new guidelines to tackle this area.
For 2013, the EBA found that “remuneration practices within institutions were not sufficiently harmonised, in particular, the application of deferral and payout in instruments differs significantly between member states and between institutions”.For 2013, the EBA found that “remuneration practices within institutions were not sufficiently harmonised, in particular, the application of deferral and payout in instruments differs significantly between member states and between institutions”.
The regulator also took a sample of 92 institutions to examine the link between pay and performance. “Overall in 2013, profitability was significantly reduced in many institutions compared with 2012. The regulator also took a sample of 92 institutions to examine the link between pay and performance.
“Consequently the average net profit per staff member was reduced in 2013. Based on the aggregated figures no strong correlation between the average net profit of institutions and the remuneration of identified staff could be observed”. “Overall in 2013, profitability was significantly reduced in many institutions compared with 2012. Consequently the average net profit per staff member was reduced in 2013. Based on the aggregated figures no strong correlation between the average net profit of institutions and the remuneration of identified staff could be observed.”