Regulators give banks freedom to restructure pay

  • UK regulators are removing the bonus cap on bankers
  • The cap limits variable pay at twice base salary
  • The removal allows firms to restructure pay within regulatory rules
  • The aim is to align remuneration with prudent risk taking

Factuality Level: 8
Justification: The article provides factual information about the U.K. Financial Conduct Authority and Prudential Regulation Authority removing the bonus cap on bankers. It mentions the plan being outlined by Kwasi Kwarteng and confirmed by Jeremy Hunt. The regulators’ statement is also quoted. However, the article lacks additional context or analysis, and does not provide any opposing viewpoints or potential consequences of removing the bonus cap.

Noise Level: 7
Justification: The article provides some information about the removal of the bonus cap on bankers in the UK, but it lacks depth and analysis. It does not explore the potential consequences of this decision or provide any evidence or examples to support its claims. The article also does not provide any actionable insights or solutions for the reader. Overall, it contains some relevant information but lacks rigor and depth.

Financial Relevance: Yes
Financial Markets Impacted: Banking sector

Presence of Extreme Event: No
Nature of Extreme Event: No
Impact Rating of the Extreme Event: No
Justification: The article discusses the removal of the bonus cap on bankers by the U.K. Financial Conduct Authority and Prudential Regulation Authority. This decision will impact the banking sector by allowing firms to restructure their pay and align remuneration with risk-taking. However, there is no mention of any extreme event or its impact.

Public Companies:
Private Companies:
Key People: Ian Walker (Author), Kwasi Kwarteng (Former Treasury Chief), Jeremy Hunt (Successor of Kwasi Kwarteng)

The UK Financial Conduct Authority and Prudential Regulation Authority have announced the removal of the bonus cap on bankers. This cap, which limits variable pay at twice base salary, will be lifted at the end of this month. The regulators stated that this move will allow firms to restructure their pay over time, while still adhering to the rules on variable remuneration. The aim of this change is to better align remuneration with prudent risk taking.