Labour plans to refer banks to competition authorities

Labour plans to refer high street banks to the competition authorities immediately if elected in 2015, the party leader is expected to say in a speech on banking reform.

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Cable urges RBS to 'show restraint' on bonuses

Business Secretary Vince Cable would not be drawn on whether the government should reject any attempt by RBS to exceed the EU bonus cap but urged the bank to "show restraint", during an interview with ITV News.

He told Deputy Political Editor Chris Ship that the bank, which is 81% owned by the taxpayer, had not so far come forward with any propositions on bankers' bonuses.

Under EU laws, a bonus awarded to a banker that is over double their annual salary has to be approved by shareholders.

As Chancellor, Mr Osborne is effectively the bank's main shareholder.

BoE Governor: UK a 'hard touch' on bankers' pay

Bank of England Governor Mark Carney said the UK already had a "hard touch" regime in relation to bankers' pay and criticised the EU cap on bonuses.

Mr Carney said the cap would partly reverse the changes that have been made to be able to recover bonuses from bankers.

It takes back some of the advantages of the approach that we have had because it will incentivise more cash compensation today - exactly the type of problem we had before - that we can't claw back.

We would rather see more deferral, more equity [share-based payout] and this ability to take it back when those risks come to light.

– Mark Carney, Bank of England Governor

He also denied the suggestion that regulators had "dropped the ball" over bankers' pay.


Carney 'agrees' bonus cap is not right way to control pay

Bank of England Governor Mark Carney said that he "absolutely" agreed with the Parliamentary Commission's comments on the EU bonus cap that concluded: "We're not convinced that a crude bonus cap is the right instrument for controlling pay."

He also said that he had "no reason to disagree" with comments from the Independent Commission on Banking (ICB) that capping market share and balance sheet size "would not result in substantial improvements to competition in retail banking in the UK."


PM: Government will veto any RBS bonus increases

Unite attacks Osborne 'hypocrisy' over RBS bonuses

As George Osborne claimed that EU rules on bankers' pay would lead to a "Fred Goodwin-style situation", Unite said the Chancellor "must not rubber stamp the corporate greed" at RBS, as the majority taxpayer-owned bank reportedly seeks to double its cap for bonuses to senior staff.

Thousands of RBS staff are struggling to feed their children and pay their utility bills as they earn so little. They, along with taxpayers, have every right to expect this Government to block any attempt to further reward these senior bankers.

The hypocrisy of George Osborne in claiming that 'it is totally unacceptable for bank bonuses to be paid on the back of taxpayer guarantees' will disgust working people.

His decision on RBS will show his true colours.

– Rob MacGregor, national officer of Unite

EU rules on bankers' pay 'will lead to Goodwin situation'

In a speech warning of the need for EU reform, Chancellor George Osborne said that EU rules on bankers' pay would lead to a "Fred Goodwin-style situation" in which money would not be recoverable

"These European rules will not lead to bankers being paid less," he said. "What they will lead to is a Fred Goodwin-style situation where you will not be able to get money back off bankers when things go wrong."

"That is precisely what we have been trying to get away from in Britain," the Chancellor added.

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