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Banks: Pay

Volume 501: debated on Wednesday 25 November 2009

To ask the Chancellor of the Exchequer if he will introduce legislative proposals to limit the remuneration of directors of banks with deposit-taking licences to 10 times the average wage paid to employees of that bank. (300726)

The Government have taken steps to ensure that remuneration paid at systemically significant financial institutions is commensurate with a prudent approach to risk and leads to long-term value creation. The FSA code, which comes into force on 1 January 2010, includes requirements for deferral and clawback from significant banking and other institutions. In addition, the Government are taking legislative measures in the Financial Services Bill that will strengthen the FSA's hand and enable improved disclosure of remuneration, which in turn will facilitate better shareholder oversight of risk.