Andrew Bailey, chief executive of the Prudential Regulation Authority (PRA) and deputy governor of Bank of England, said allowances for top banking executives are likely to be paid this year despite the fact that they have been deemed breach of the bloc’s cap on banker bonuses.
As part of the rules of European Banking Authority (EBA), bank bonuses should be not more than 100% of salary – or 200% with shareholder approval.
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"I’ve said a number of times I do not regard allowances as per se a good thing. I’m not surprised they’ve come into existence," Bailey told the UK parliament’s Treasury Select Committee.
"We will discuss that with them and then the banks need to form a view on what they will do," Bailey said.
"It is a non-binding opinion and there has to be a decision on what we do with it.
"My own view is it is too far into this year as a matter of good practice to change anything this year," he added.
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By GlobalDataHe also said jailing, fining and firing more individual bankers is a better way to punish bad behaviour than hitting banks with crippling fines which could risk their stability.
