STOCK MARKET WATCH -- Monday, 8 September 2014

[xchrom]

29. EU Banks Sidestepping Bonus Limits Face Regulatory Crackdown

http://www.bloomberg.com/news/2014-09-07/eu-banks-sidestepping-bonus-limits-face-regulatory-crackdown.html

Banks in the European Union that attempt to evade new bonus rules face a “coordinated policy response” from the bloc’s regulators.

Michel Barnier, the EU’s financial-services chief, called for action on the “politically very important matter” of lenders that have turned to so-called allowances to get around an EU ban on bonuses worth more than twice fixed pay.

“I would like to underline my strong concerns with regard to the continuing reports of the use of these allowances,” Barnier wrote in a Sept. 4 letter to Andrea Enria, chairperson of the European Banking Authority. “It is important to show a collective proactive stance on this important matter and address the claims made that the spirit, if not the letter, of union law is being disregarded.”

Barclays Plc (BARC), HSBC Holdings Plc (HSBA), Lloyds Banking Group Plc (LLOY) and Royal Bank of Scotland Group Plc are among banks that have introduced allowances in response to the bonus limit. Lenders have warned that the cap will harm their competitiveness and force them to increase fixed pay.