City bankers’ pay rises soar by 35pc

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Britain’s highest paid bankers saw their total pay soar by more than a third last year as they landed bonuses worth nearly four times their annual salary.

Figures from the European Banking Authority (EBA) revealed that the UK once more had by far the highest number of bankers earning more than a million euros (£833,000) in the European Union – at 2,714 in 2012.

That was 11 per cent higher than in 2011 and puts the City on a collision course with the new European Union bonus cap set to come into force next year.

Average total pay – including salaries, pensions and bonuses – for London’s top earning bankers surged 35 per cent to 1.95m euros (£1.6m). And they picked up bonuses averaging 3.7 times their base salary, up from 3.5 in 2011.

The EBA report shows the UK employed more than three-quarters of the EU’s highest-earning bankers – highlighting how many London staff would fall foul of the new EU rules that will cap bonuses to a year’s salary – or a maximum of two years if shareholders approve.

It will have an impact on so-called code staff, who are senior, risk-taking employees.

Chancellor George Osborne has filed a formal complaint against Brussels over the plans amid fears the move will backfire and drive up salaries. The Treasury lodged legal action in September, arguing the EU had gone beyond its remit in seeking to regulate bonuses, which it claims had been decided without proper consultation.