EU Defends Bank Bonus Cap Plan as Lawmakers Warn of Rule Evasion
The European Commission defended its plans for implementing banker bonus rules amid warnings from some lawmakers that authorities are failing to counter U.K. banks’ attempts to get around the curbs.
Technical proposals published earlier this month by the commission, the European Union’s executive arm, on who should be covered by a planned ban on bonuses of more than twice fixed pay “implement faithfully” the legislation, Chantal Hughes, a spokeswoman for Michel Barnier, the EU’s financial services chief, said in an e-mail.
The measures “don’t weaken CRDIV, but don’t strengthen it either, that’s not the role of regulatory technical standards,” Hughes said, in reference to the legislation enshrining the bonus curbs, which were agreed on last year.
European Parliament legislators are set to quiz Barnier on the proposals for defining who should be covered by the curbs at a March 18 hearing. Some members of the assembly are set to raise concerns that the implementing text could allow too many bankers to escape the curbs. Lawmakers have also urged a crackdown on what they say are systematic attempts by British-based banks to get around the pay limit.
The parliament has a maximum of three months to challenge Barnier’s approach.
Philippe Lamberts, a Belgian lawmaker in the EU assembly and one of the architects of the bonus rules, has said that the commission plans “are too lax especially at a time when shareholders don’t have enough control and bankers aren’t exercising restraint.”
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