City bankers to face even tougher regulations under EU proposals

| October 8, 2010
”City

Under new proposals being drawn up Europe’s top regulators, there are set to be new restrictions on bankers’ bonuses – which are being described as the biggest clampdown ever seen in the banking industry.

The proposals are much harsher than regulations in the US, and if introduced, will result in an overhaul of pay policies at financial institutions.

The suggestions are to cap bonuses to a maximum of 30% in cash and a clawback facility – which means a banker might not receive the full payout if investments go sour.

A spokesperson for the EU said draft regulations would be published early next week, followed by a four-week discussion within the industry.

However, the proposals have met with some criticism, and several industry groups have warned this would make EU banks uncompetitive in rival markets in Asia and the US.

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