Banks urged to cut executive pay

13 December 2012

Banks have been urged to reduce the salaries of their senior members of staff in order to regain the confidence of the stock market.

Robert Jenkins, a senior policymaker at the Bank of England (BoE), believes financiers still have work to do to be trusted once again after playing a major role in the global economic downturn, Reuters reports.

Mr Jenkins gave a speech yesterday (12 December) in which he offered advice to lenders on how they can go about restoring their damaged reputations.

As well as cutting management pay, the BoE official said banks could consider commissioning independent valuations of their investments and raising their levels of capital to convince investors they would be able to absorb any future shocks.

"This approach will put us ahead of the regulators and leave them with no place to go - they will cease to be a factor in the management of our business," he added.

By Tony Aynsley

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