| Series Title | EurActiv |
|---|---|
| Series Details | 28.02.13 |
| Publication Date | 28/02/2013 |
| Content Type | News |
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The Irish EU Presidency reached provisional agreement with the European Parliament on the 27 February 2013 on new rules that would help make sure that European banks hold enough good quality capital to withstand future economic and financial shocks. The provisional agreement ('political agreement') included restrictions on bankers pay to make sure that pay practices do not lead to excessive risk-taking. It also included new provisions to making European banks more transparent. Bankers' annual bonuses must not normally exceed their annual salaries and banks must hold more high quality capital to increase stability in the sector said the deal. The only possible exception, allowing bonuses of up to twice annual salary, would have to be authorised by holders of a half of a bank's shares. MEPs had fought for a 1:1 ratio from the outset. The 'political agreement' agreed must be approved by EU Member States in the Council and the European Parliament at a plenary session, the latter was expected at the 15-18 April 2013 session. Once approved, EU Member States would need to include the rules in their national laws by 1 January 2014. The package agreed was seen as a vital part of the single European banking rulebook, a fundamental building block for EU banking union. Completing banking union was an Irish EU Presidency priority for the period January-June 2013. The United Kingdom government made it clear on the 28 February 2013 that it would oppose the details of the agreement when EU Finance Ministers met at an EcoFin Council in March 2013. It argued that EU rules should allow flexibility at national level, claiming that Britain 'has some of the toughest remuneration requirements in the world'. Most other governments backed the bonus cap in order to ensure that other so-called Basel III rules are introduced. Consensus over the cap means the Basel III code of capital standards, drawn up by international regulators to reform banking following the financial crash, can come into force by the January 2014 deadline. British Prime Minister David Cameron said on the 6 of March he wanted to ensure EU plans to limit bankers' bonuses did not threaten the national interest, but it later became clear that Britain is only seeking minor changes to what is almost a done deal. |
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| Source Link | Link to Main Source http://www.euractiv.com/euro-finance/eu-puts-cap-bankers-bonuses-news-518134 |
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| Subject Categories | Business and Industry |
| Countries / Regions | Europe |
