Bailey Says ‘No Current Plan’ to Review Banker Bonus Cap
Bailey Says ‘No Current Plan’ to Review Banker Bonus Cap Rule
(Bloomberg) -- Andrew Bailey says there are no plans to remove a limit on the bonuses of U.K.-based bankers, even as he made it clear he’s no fan of the cap.
“It’s not one we’re currently reviewing so no current plan is the best way of addressing that question,” the Bank of England governor said in an interview with Bloomberg Television Thursday. “It remains the case that I don’t think it’s the best way to address remuneration.”
Bailey has previously criticized the cap, which limits banker’s bonuses to two times their salary. The rule was introduced by the European Union in the wake of the 2008 financial crisis, but it was thought that the U.K. might ditch the rules after Brexit to lure bankers to the City.
His comments came as the BOE warned that a gradual increase in interest rates could be on the horizon as inflation creeps higher.
Bailey’s stance is the latest sign that British regulators have little appetite for a wholesale revision of the U.K.’s financial rulebook after Brexit. Executives of several major banks have previously told Bloomberg they don’t expect authorities to ditch too many inherited rules, including the bonus cap on banker pay.
Changing the rule is “not currently a high priority,” Bailey said.
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