(FT) -- The world's biggest investment banks are to overhaul their pay structures to differentiate between bankers based in Europe and those who work elsewhere, after European regulators' clampdown on bonuses.
Many U.S. and Swiss banks are considering paying higher salaries and lower bonuses to top bankers based in the European Union, mostly in London, to ensure they comply with new instructions from the Committee of European Banking Supervisors (CEBS), the pan-EU regulator, limiting cash pay-outs.
Some European politicians had expected that non-EU banks would apply their rules globally on a voluntary basis.
But one senior European banker said: "Politicians are naïve if they think we will impose EU rules on a global basis. The ironic effect will be another hike in salaries, which is a fixed cost, which rather makes a nonsense of the idea of pay for performance".
Most banks insist that the pay of non-EU based staff will not be brought into line with the stricter European regime. "We're going to have to pay people differently in different parts of the world," said one top US banker. "There will be higher salaries for people in the UK, but lower bonuses. In the U.S., bonuses will be slightly higher". CNN
