5th Jun 2023

British bankers dominate EU rich-list

  • Another day at the office: British bankers scoop the most big bonuses in Europe (Photo: stumayhew)

British bankers dominate Europe's financial sector rich-list, according to data published on Monday (15 July) by the bloc's banking watchdog.

Data collected by the European Banking Authority (EBA), the EU agency that serves as the sector's watchdog, notes that 2,346 British-based bankers earned more than €1 million in 2011.

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The figure is more than three times as many as the 739 millionaire financiers across the rest of the EU and more than 10 times as many as Germany, second on the list, with 170.

The eurozone's four bailout countries - Cyprus, Greece, Ireland and Portugal - had 38 millionaire bankers between them, while nine member states had none.

However, Spain's 125 banking millionaires were the best paid, earning, on average, the tidy sum of €2.4 million.

The average millionaire banker in the UK received a mere €1.4 million.

Banking authorities have to reveal the number of individuals earning at least €1 million under EU bank bonus rules agreed in 2010. They are also required to include the business area involved and a breakdown of the different pay elements including salary, bonus, long-term award and pension contribution.

Lawmakers and regulators believe that a rampant bonus culture led banks to focus more on short-term gains than on on longer-term profitability, fuelling the risky activities that undermined bank stability during the financial crisis.

The news will not come as a surprise to observers, but demonstrates the size of the UK's financial sector.

Salaries totalling €784.5 million were paid out to the British banking elite, alongside bonus payments worth €2.7 billion.

Meanwhile, a total of £13 billion (€16bn) in bonuses were lavished across the entire UK banking industry, although this figure is down from £19 billion in 2007-8, at the start of the crisis.

That said, the sector is braced for further clampdowns on bonus payments under the latest version of the EU capital requirements directive agreed earlier this spring.

Under the new rules, bonus payments will be limited to 100 percent of salary, with a derogation to increase it to 200 percent only if there is shareholder approval.

EU lawmakers have also forced bonuses to be restructured so that at least half of the extra payment is made up of contingent capital or shares, which can be recouped if the firm gets into difficulties.

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