July 15 (Bloomberg) -- Top Spanish investment bankers were paid an average of almost 2 million euros ($2.6 million) in 2011, about 45 percent more than their British peers, according to a survey by the European Union banking regulator.
The European Banking Authority found that average pay for some U.K. investment bankers fell by about 1 million euros between 2010 and 2011 to 1.38 million euros. The best paid bankers in France, Germany, the Netherlands and Sweden also earned more than those in the U.K. on average in 2011, according to the London-based EBA’s report.
The EU brokered a deal in February to outlaw banker bonuses that are more than twice fixed pay, a move lawmakers said would prevent excessive payouts and curb irresponsible risk-taking. U.K. Chancellor of the Exchequer George Osborne opposed the curbs, saying they would harm the competitiveness of the nation’s finance industry.
French investment bankers had the highest ratio of bonus to salary, whose variable remuneration of more than eight times their base pay in in 2010. The U.K. ratio declined from 647 percent to 394 percent in 2011. The EBA included pension contributions in its definition of total discretionary bonuses.
“Some of it was certainly the market, and some of it can be attributed to an increase in base remuneration,” Tom Huertas, a partner at Ernst & Young LLP and former vice-chairman of the EBA, said in a telephone interview today.
The EBA said in May that any banker paid more than 500,000 euros should be covered by the new bonus rules. The watchdog also targeted the best paid 0.3 percent of staff in a bank, and some bankers with bonuses higher than 75,000 euros.
U.K. bankers covered by the European Union’s cap on bonus payouts may get as much as 500 million pounds ($755 million) more in salary to compensate, Andrew Bailey, Britain’s chief banking supervisor, told U.K. lawmakers in March.
Top retail bankers earned more than their investment banking counterparts in Spain, Germany, Denmark, Austria and Hungary, according to the report.
National supervisors collected the figures for the EBA’s survey, which only covers staff paid more than 1 million euros.
The report is a response to a political demand to have greater transparency about pay and remuneration of individuals who are running organizations that have received some degree of public support,” said Huertas.
The U.K. was home to 1,809 investment bankers earning more than 1 million euros in 2011, the highest amount in the EU, while Spain had 44. France and Germany had 101 and 90 respectively.
Spain last year sought a bailout for its banking system on concern that losses from lenders built from former savings banks such as the Bankia group would contaminate government finances and hobble its efforts to rein in the country’s deficit. The bursting of the country’s real estate bubble has driven up defaults, sapped demand for lending and led banks to refinance or restructure as much as 208 billion euros of loans.
To contact the reporter on this story: Ben Moshinsky in London at email@example.com
To contact the editor responsible for this story: Anthony Aarons at firstname.lastname@example.org