UK will not seek exemption from EU bank rules

The Financial Services Authority (FSA) has dismissed claims that it will challenge tough European rules governing bankers’ pay, and said it is not seeking an exemption.

Earlier this week a majority of 625 to 28 European parliament members voted in favour of implementing rules to restrict bank pay.

The new rules would see the cash element of bonuses capped at 30% and 20% for top earners and the rest deferred for three years. Half of remuneration would be paid in ‘contingent capital’ which could be recovered if the bank runs into problems.

The directors of part-nationalised banks would be governed by separate pay rules.

The FSA dismissed reports this morning that its lawyers were looking at whether Britain could claim an exemption from the rules by claiming that the financial services sector was already sufficiently regulated.

A spokeswoman for the FSA said: ‘We are not seeking an exemption. We are reviewing the EU text to see what it means for our code.’