Irish Finance Minister Michael Noonan said he expects the European Union will reach a compromise over limits on bankers’ bonuses that won’t hurt London’s financial industry.
Ireland, which holds the rotating presidency of the EU until the end of June, will seek an accord after talks to implement the latest round of the Basel Committee on Banking Supervision’s rules broke down this week, Noonan said in a Bloomberg Television interview in London today. The European Parliament added the bonus caps into the legislation, he said.
“It seems to be the one large issue of substance that’s left in the negotiations,” he said in the interview with Francine Lacqua and Guy Johnson. “We think a via media, a settlement, can be reached without upsetting the cost base in the City of London or without depriving people of rightfully-earned bonuses.”
The U.K. is opposed to a draft deal that would cap banker bonuses at twice fixed pay. Bonuses exceeding fixed salary would also be subject to vote by shareholders. Such a proposal would undermine companies’ ability to reduce compensation expenses in a downturn, according to the Confederation of British Industry, the country’s largest business lobby group.