Pay dirt

7 January 2011 By Margaret Doyle

A deal with the coalition government is expected to leave UK banks claiming to have curbed banker pay in deference to the public mood. Given that lower revenues were set to dampen bonuses anyway, the proof of any such statement will have to come in lower payout ratios.

This content is for Subscribers only

Context News

The big five UK banks are expected to unveil a deal with the coalition government whereby they commit to show pay restraint by paying less than they would otherwise have done in the upcoming spring bonus season, according to people familiar with the talks.

Several senior members of the government have warned banks on high payouts. Vince Cable, the Liberal Democrat Business Secretary, has been the most vocal, warning of potential taxes on "scandalous" pay.

Conservatives have warned banks not to ignore the public mood. David Cameron, the prime minister, said banks had to understand the "political context".

At a Dec. 21 meeting described by the Treasury as "constructive", the banks were reported to have given a commitment to "pay discipline" and to lend around 70 billion pounds to small businesses in 2011 a rise of around 10 billion pounds on 2010.

Email a friend

Please complete the form below.

Required fields *