Watchdogs plan to check up on big international banks directly to see if they have improved compliance with globally-agreed bonus curbs. The Financial Stability Board (FSB) said in a statement its latest review would survey supervisors and regulators as well as "a sample of major firms directly."
The board, made up of central bankers and supervisors from the world's 20 leading economies (G20), is tasked to ensure that regulatory pledges made at the height of the financial crisis are being applied consistently around the world. Last year's review showed that effective implementation of the FSB principles was far from complete and that another review was needed in 2011.
The principles require bankers to defer a part of their bonus or variable pay over several years with a portion paid in shares or other non-cash instruments. The outcome of the latest review will be published in the autumn. Policymakers believe the large, all-cash upfront bonuses paid in the past spurred bankers to take excessive risks and helped lay the ground for the financial crisis.
The principles are seen as a minimum requirement while the European Union has turned a tougher version into a law that came into effect in January, going further than the United States which has largely toed the FSB line. EU financial services chief Michel Barnier has threatened to take the bloc's bonus curbs further as some banks bump up fixed salaries.
A survey released on Tuesday showed that more than half of finance workers in London say they are planning to switch jobs this year and another 36 percent are considering jumping ship as higher taxes and a clampdown on bonuses test the loyalty of top staff.
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