Bankers may face 10-year bonus wait

Bankers’ bonuses could be deferred for up to ten years and directors held personally liable for future collapses under a series of recommendations published by MPs and peers this week.
By The Newsroom
Published 10th Jun 2013, 10:02 BST

The Parliamentary Commission on Banking Standards is also expected to call for a shake-up in the “approvals regime” register for senior bank executives and the opening up of the sector to more competition.

It was reported last week that the commission will also call for the taxpayer-backed Royal Bank of Scotland to be split into a good bank and a bad bank.

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The commission, chaired by Conservative MP Andrew Tyrie, includes the Archbishop of Canterbury Justin Welby and former Chancellor Lord Lawson as well as Labour and Liberal Democrat parliamentarians.

Set up in the wake of a deluge of scandals including Libor rate-rigging and the mis-selling of payment protection insurance, it is said to be finalising the near 600-page report.

According to the Financial Times, the report will propose that UK bankers – who typically receive bonuses after one, two or three years – would be barred from accessing payouts for as long as ten years to force them to think more carefully about the long-term impact of their behaviour and avoid short term-profiteering at huge risk.

The proposal comes on top of EU measures to cap bonuses at one times salary – or double with the approval of shareholders.

Related topics:MPsRoyal Bank of Scotland