U.K. bankers earning more than 1 million euros ($1.3 million) in 2010 and 2011 outnumbered all of their counterparts in the rest of the European Union put together, a new report showed, although the average pay of U.K. bankers fell.
The study by the European Banking Authority (EBA) revealed that the number of bank staff in the European Union who earned one million euros or more in total in 2010 and 2011 totaled 2,346 in the U.K., while in Germany – which came second in the rankings - only 170 bankers earned more than a million euros. The numbers of high earners in Spain (125), Italy (96) and the Netherlands (36) also lagged far behind the U.K.
The figures came after Dutch finance minister and head of the euro group of finance ministers, Jeroen Dijsselbloem, pledged to crack down on financial sector bonuses in the Netherlands saying they jarred with "the spirit of the times."
The Dutch government plans to cap performance-related bonuses in the financial services sector at 20 percent, going beyond new rules introduced for the whole of the EU. In February, the EU agreed to outlaw banker's bonuses that were more than twice the fixed salary amount.
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The move was vehemently opposed by the U.K's treasury minister George Osborne, who said the curb would harm the U.K.'s competitiveness in the banking industry.
Though more numerous as a group, the average pay for high-earning U.K. bankers fell in 2011 to 1.4 million euros in 2011 compared to 2.3 million euros in 2010. Average pay was higher in Germany, Sweden, the Netherlands and France in the same year. When Spain was in the midst of a banking bailout crisis in 2011, investment bankers were paid an average 2 million euros.
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Investment and retail banking, asset management and other business areas relating to the executive board or risk management, auditing and corporate finance, were among the categories in which the highest earners were found.
Analysts have warned that to get around the rules, banks will simply increase salaries to include the anticipated bonus and subject it to a clawback for underperformance.