UK banks 'could face bonus sanctions'

9 December 2011

British banks could face regulatory sanctions if they fail to comply with new calls to restrain their bonus awards.

That is according to chancellor George Osborne, who has urged financiers across the country to make sure they abide by calls to tone down additional payments made to members of staff on top of their standard wages.

Speaking to the economic affairs committee in the House of Lords, Mr Osborne - who is also MP for Tatton - explained that lenders should be looking to adjust their policies when it comes to remuneration packages depending on the wider economic climate.

And, due to the fact financial markets are struggling at present, he stated these companies should follow the guidance of the Bank of England and the government and strive to cut their bonus payments to "enhance their capital positions".

"They've had some time to absorb that advice and I would absolutely expect them to do so - there would be consequences if they didn't," the official added.

By Tony Aynsley

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