UK Chancellor Osborne Against EU Cap on Bank Bonuses

Chancellor George Osborne has told European Union finance ministers that he cannot support proposals to curb bankers’ bonuses.

At a meeting of the EU’s Economic and Financial Affairs Council in Brussels he appealed for further negotiations.

The meeting discussed a possible “tweaking” of plans to limit bonuses to 100% of a banker’s annual salary, or to 200% if shareholders approve.

The City of London fears the rules will drive away talent and restrict growth.

Most members of the 27-nation EU are firmly behind the proposals, which are part of wider measures requiring banks to strengthen their capital buffers in the hope of avoiding another financial crisis.

The proposals still need formal approval from the European Parliament and EU states.

Speaking after the meeting, Mr Osborne said Britain already had the toughest regime in Europe for bankers’ pay and bonuses and that a cap could “have a perverse effect”.

Although ministers could still push through the proposals without the UK’s support, German Finance Minister Wolfgang Schaeuble said “it would be better” to reach consensus.

via BBC

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza