Foreign banks agree FSA pay rules

Major overseas banks operating in London have agreed to implement
rules on remuneration, the Treasury has said. In August, the
Financial Services Authority published a code on bankers' pay, due to
take effect from January. Last month, the five biggest banks in the
UK agreed to accept the rules on pay, and they have now been followed
by eleven foreign banks. There must be "national and international
consistency" on the issue of pay, the banks said in a statement. The
FSA rules say that bonuses should not be guaranteed for more than a
year, and that senior employees should have their bonuses spread
over three years. However, there are no enforced caps on bonuses. Last
month, G20 leaders agreed to introduce rules on pay, and it is down
to individual countries to implement them. The banks that have signed
up include US banks Merrill Lynch, Bank of America, Citigroup,
Goldman Sachs, JP Morgan and Morgan Stanley. The others are: Credit
Suisse, Nomura, UBS, BNP Paribas, Deutsche Bank and Société Générale.
On Thursday, Goldman Sachs is expected to report large profits,
leaving it with a bonus pot of about $20 bn (£12.5 bn) - the biggest
in the company's history.