Provisional Bonus Cap Added to EU Basel III Implementation Proposal - Major Impact on London and EU Banks Possible

February 2013


EU negotiators on CRDIV – the EU Basel III implementation proposal – reached a preliminary agreement on February 27, 2013 to include a provision that would limit European bankers’ bonuses. Specifically, bonuses for senior management and material risk-takers – so-called “identified staff” – would not be able to exceed a banker’s fixed salary.

Detailed draft text is not yet available so our views are provisional. In addition, further developments may occur over the next several days or weeks that could impact the final provisions as the EU legislative process moves forward.

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