11 Oct 2010

EU bankers' bonus cap a step closer

10:30 am on 11 October 2010

European regulators have backed tougher than expected draft rules on bankers' pay despite pressure from the UK and France to water down the restrictions.

The BBC reports that if the draft rules are implemented, it would cap the amount of a bonus able to be taken in cash to a maximum of 30%.

The measures have been passed by the Committee of European Banking Supervisors (CEBS), made up of financial watchdogs from the EU's 27 members.

Britain argues that the new regime will make the European Union uncompetitive.

The European Parliament has already cleared the proposals, which limit the cash payout to about 30% of standard bonuses, and a fifth of larger ones.

An EU official said draft regulations would be issued within the next few days, followed by a one-month discussion.

The new rules would apply to the worldwide operations of banks and subsidiaries operating within the EU.