London Bankers Report Fewer Bonuses as Pressure Mounts

The proportion of employees in London’s financial district who received a bonus and pay increases this year declined as regulatory pressure to curb compensation mounted, a survey showed.
Bonuses were paid to 68 percent of employees for 2012 compared with 82 percent a year earlier, London-based recruitment firm Morgan

McKinley said in a statement today. The survey also found 36 percent of workers received a pay increase compared with 47 percent a year ago.

“There is a much greater acceptance of the downward pressure on cost management and the knock-on effect on overall reward,” Hakan Enver, operations director at Morgan McKinley Financial Services, said in the statement. “These hiring managers will be in the position themselves of both being eligible for a share of the bonus pot and also having to make decisions about rewarding their own teams.”
The industry has been cutting fixed costs as Europe’s sovereign debt crisis crimps income from investment-banking businesses and regulators pressure firms to cut compensation amid public anger over bank bailouts. Royal Bank of Scotland Group Plc, HSBC Holdings Plc, Lloyds Banking Group Plc and Barclays Plc (BARC) will employ about 606,000 people worldwide by the end of 2013, according to data compiled by Bloomberg. That’s 24 percent below the peak in 2008, the data show.
The European Union also brokered a deal in February to outlaw banker bonuses that are more than twice fixed pay, a move lawmakers said would curb high payouts and stop irresponsible risk-taking. The survey found that 83 percent of respondents would still not consider working outside of London if the European bonus cap is imposed.
“The vast majority of these individuals are unlikely to be in line for receiving 100 percent of their salary as a bonus and therefore will be unaffected by these new regulations,” Enver said.
Morgan McKinley said it surveyed 180 workers by telephone in London about their bonus expectations.

Πηγή: Bloomberg