Five banks sign a bonus restriction agreement
Five banks including HSBC and RBS sign new restriction agreement on bonuses
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By Richard James. |  |
Thursday, 01, Oct 2009 02:20
By inthenews.co.uk staff.
Five banks have signed up to new restriction on bonuses, it was announced today.
Barclays, HSBC, Lloyds Banking, Royal Bank of Scotland (RBS) and Standard Chartered are to put into place rules on remuneration agreed at the G20 summit in Pittsburgh.
Over a three year period, 40 to 60 per cent of senior executives' bonuses will be deferred, with 50 per cent in shares.
Poor performance will also see previous bonuses clawed back and the Financial Services Authority (FSA) will be able to force banks to hold more capital if bonuses fail to meet the new rules.
A joint statement from the banks reads: "In a competitive and international business it is right to make sure that our staff are appropriately and competitively rewarded for sustainable, long-term performance.
"We will work with the FSA in adopting these remuneration reforms, recognising that all G20 nations have also committed to their implementation to ensure a level playing field."
Annual reports on bonuses for shareholders with the disclosure of bank bosses pay will also come out.
Chancellor Alistair Darling said the move by the five banks should "set the standard for all other UK and international financial institutions to follow".
He added: "It is vital that our financial services industry remains at the forefront of the industry globally and takes a responsible and long-term approach to remuneration."