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November 17, 2010    

HSBC to double pay of top bankers

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by Kay Murchie

Banking giant HSBC is proposing to raise the basic salaries of its senior investment bankers, in an attempt to beat the crackdown on bonus payouts.

However, the move is likely to trigger unrest among the public sector, which is faced with savage cuts, as the Government attempts to bring down the budget deficit.

Furthermore, the move will not be welcomed by politicians, who have already expressed their dissatisfaction with regard to bonus payments within the banking industry.

Deputy Prime Minister Nick Clegg recently said ministers would not stand “idly by” if banks awarded its staff hefty payouts after being bailed out by the taxpayer.

However, HSBC is one of the few banks not to receive any taxpayer bailout money after surviving the financial crisis better than many of its rivals.

Meanwhile, HSBC, which is Europe’s largest bank, has operations in leading financial centres including London, Hong Kong and New York.

It recently said it was struggling to recruit new staff because of a Financial Services Authority rule that prevents it from offering two-year guaranteed bonuses.

The bank has expressed concern that Europe and Britain were going further than any other financial centres by severely clamping down on pay.

The announcement comes as the new super-tax, introduced by the Government, will see the Treasury take a larger slice of a bank’s bonus pool.

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