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Bank of England to unveil bonus clawback plan Bank of England to unveil bonus clawback plan
(35 minutes later)
The Bank of England is expected to unveil on Wednesday a plan which may see rule-breaking bankers return bonuses up to seven years after being awarded them, the BBC understands.The Bank of England is expected to unveil on Wednesday a plan which may see rule-breaking bankers return bonuses up to seven years after being awarded them, the BBC understands.
Losses, poor risk management or other bad behaviour could trigger clawbacks.Losses, poor risk management or other bad behaviour could trigger clawbacks.
Even if bonuses paid in shares have been cashed and spent, the move could mean money paid to bankers breaking the rules can still be demanded back.Even if bonuses paid in shares have been cashed and spent, the move could mean money paid to bankers breaking the rules can still be demanded back.
If approved, it may create one of the world's toughest regulatory regimes. The move comes days after Lloyds Banking Group was fined £218m.
The move comes days after Lloyds Banking Group was fined £218m for "serious misconduct" over some key interest rates set in London. The company was condemned for "serious misconduct" over some key interest rates set in London.
'Reprehensible''Reprehensible'
Lloyds manipulated the London interbank offered rate (Libor) for yen and sterling and tried to rig the rate for yen, sterling and the US dollar, said the US legal order.Lloyds manipulated the London interbank offered rate (Libor) for yen and sterling and tried to rig the rate for yen, sterling and the US dollar, said the US legal order.
It also manipulated submissions for another short-term rate linked to the value of UK government debt.It also manipulated submissions for another short-term rate linked to the value of UK government debt.
Bank of England Governor Mark Carney called such misconduct "reprehensible".Bank of England Governor Mark Carney called such misconduct "reprehensible".
The central bank warned in March bankers may have to return their bonuses up to six years after receiving them.The central bank warned in March bankers may have to return their bonuses up to six years after receiving them.
Speaking earlier in the year, Mark Carney, the governor of the Bank of England, told the BBC's Andrew Marr bank bonuses should be deferred for a "very long time" to ensure bad practice is not rewarded.Speaking earlier in the year, Mark Carney, the governor of the Bank of England, told the BBC's Andrew Marr bank bonuses should be deferred for a "very long time" to ensure bad practice is not rewarded.
Capital levelCapital level
He said the structure of compensation should change to allow banks to take back bonuses if senior staff are found to have taken "risks that were not fully understood" and if there are "conduct issues".He said the structure of compensation should change to allow banks to take back bonuses if senior staff are found to have taken "risks that were not fully understood" and if there are "conduct issues".
He said new rules already in place would prevent banks from paying increased bonuses if their capital levels fall below a certain level.He said new rules already in place would prevent banks from paying increased bonuses if their capital levels fall below a certain level.
In February, the Bank of England set out tougher proposals for non-EU banks to try to prevent a repeat of the 2008 financial crisis.In February, the Bank of England set out tougher proposals for non-EU banks to try to prevent a repeat of the 2008 financial crisis.
Non-EU banks wanting to take deposits would have to set up subsidiaries in the UK and face stricter rules, it said.Non-EU banks wanting to take deposits would have to set up subsidiaries in the UK and face stricter rules, it said.
These would then be directly regulated by the UK's Prudential Regulatory Authority (PRA).These would then be directly regulated by the UK's Prudential Regulatory Authority (PRA).
What do you think about this expected plan? Are you a banker? If so, what are your thoughts on the move? You can send us your views and experiences by emailing haveyoursay@bbc.co.uk using the subject line "bank bonuses".What do you think about this expected plan? Are you a banker? If so, what are your thoughts on the move? You can send us your views and experiences by emailing haveyoursay@bbc.co.uk using the subject line "bank bonuses".