Regulators loosen restrictions on bankers bonuses

Simon Youel, Head of Policy and Advocacy at Positive Money, said:

"It seems a bizarre time for the Bank of England to loosen restrictions on bankers bonuses given the Governor's recent warnings about the risks of complacency since the last financial crisis.

"Bankers bonuses are widely acknowledged to have fuelled the excessive risk-taking that previously crashed the economy, and more money wasted on bonuses means less capital for banks to invest productively in the economy.

"Regulators should resist industry lobbying and ensure the financial sector serves society and not simply itself."

Notes:

1. The PRA and FCA's full announcement can be found here: https://www.bankofengland.co.uk/news/2024/november/pra-and-fca-publish-consultation-on-pay-for-senior-bankers

2. The Governor of the Bank of England, Andrew Bailey, warned about falling into "the trap of complacency" in a speech given at the Bloomberg Regulatory Forum on 22 October 2024: https://www.bankofengland.co.uk/speech/2024/october/andrew-bailey-keynote-address-at-the-bloomberg-global-regulatory-forum