The EU banker bonus cap goes into effect on January 1, 2014 and will ultimately impact fewer people than previously proposed.
On December 16, 2013, the European Banking Authority ("EBA") issued its final draft regulation on criteria to identify “Material Risk Takers” who will be covered by the EBA’s expansion of the upcoming EU banker bonus cap.
The final draft regulation caps fewer bankers’ bonuses than the EBA’s previous proposal did. However, because the EBA’s final draft came out sooner than expected (it was not supposed to be finalized until as late as March 31, 2014), the expansion will likely go into effect well before its previously anticipated implementation date of January 1, 2015.
This Financial Services Regulatory Brief highlights our US view of the significant changes, given that the cap applies to subsidiaries and branches of EU banks located in the US.