EU rules to cap bonus pay-outs from next year

BANKERS in Europe will not be allowed to take home more than a third of their bonuses in cash from the start of next year.

The plans for new rules, which go further than American rules agreed last week, would be the first cap on how bankers are paid.

A new watchdog for European banks will decide on the definition of a large bonus, which will then be capped at one-fifth.

“The bankers have shown that despite the crisis, they are not able to show self-restraint. This law will do it for them,” said Arlene McCarthy, the Labour party lawmaker who negotiated tougher rules with European countries on behalf of parliament.

Banks which have been bailed out must limit bonuses paid to managers.