FSA extends pay and bonus code
- FSA looks to extend a clampdown on banker payouts to a much wider range of jobs in finance
- Scope includes hedge funds, asset managers, venture capitalists, stockbrokers & corporate finance operations
- Critics express concerns about a brain drain of the UK's best financial talent
The Financial Services Authority (FSA) is looking to put an end to a remuneration culture in the City that encourages excessive risk taking, as it prepares to extend a clampdown on banker payouts to a much wider range of jobs in finance.
The City regulator has begun a consultation on its remuneration code and has warned that its scope would have to expand from the 27 companies currently affected to 2,500 as a result of new European rules, known as the capital requirements directive.
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The Bottom Line:If Mr Cable has his way...
"If Mr Cable had his way, all the big banks would be broken up and bonuses would be virtually eliminated - a sure-fire way in my view of guaranteeing an end to the UK’s ability to compete as an international financial centre. Let’s not forget that this is a man who is on record as saying that everyone who works in a bank has an ‘aristocratic lifestyle’ clearly demonstrating his lack of understanding of the sector." A tough line on bankers’ bonuses could make a brain drain of financial talent a distinct possibility, warns Paul Marsden. Read more