|
|
Andrew Bailey, the chief executive of the Financial Conduct Authority, said that the UK saw more use in focusing on being able to defer compensation rather than limiting it. He confirmed that the bonus cap is one element of regulation the UK may choose to cast off once it leaves the European Union.
He conceded that much would depend on the eventual agreement between the UK and the EU. There are concerns that if the UK’s access to the single market will depend on it having an equivalent set of rules, which will limit how much the UK can differ in setting its own regulations, and may make the FCA and the Bank of England as “rule takers” rather than “rule makers”.
“A better outcome would be for broad equivalence to be agreed in terms of outcomes,” he said.
Mr Bailey was speaking two days after Mark Carney, the governor of the Bank of England, revealed for the first time that the UK could cast off certain elements of regulations post-Brexit, including the bonus cap, parts of Brussels’ insurance regulations, and the full weight of global rules for challenger banks and building societies.
The UK has long been against the bonus cap, arguing that it removes regulators’ discretion to claw back large parts of compensation if they find wrongdoing.
Mr Bailey repeated calls for a Brexit transitional deal to be agreed as soon as possible — even by December 14 — to smooth the effects for financial companies that will otherwise have to launch their worst-case contingency plans.
Full article on Financial Times (subscription required)