LONDON (Reuters) – The number of bankers in the European Union paid over a million euros ($1.1 million) a year rose in 2017 to nearly 5,000, even after regulators capped bonuses.
Most of them were based in Britain, according to data from the European Banking Authority (EBA), but as the country is due to leave the bloc at the end of this month some highly paid bankers are expected to move from London to staff new hubs on the continent.
EBA said on Monday that 4,859 bankers were paid more than a million euros in 2017, including bonuses, up from 4,597 in 2016.
After taxpayers bailed out lenders during the financial crisis a decade ago, the EU capped bonuses from 2014 to no more than basic salary, or twice that amount with shareholder approval.
EBA said the average ratio between variable and fixed pay for the high earners continues to fall, down from 104 percent in 2016 to 101.08 percent in 2017 as the cap bites. It was 123 percent in 2014 and 118 percent in 2015.
The higher earners were predominantly based in Britain, totalling 3,567 in 2017 or 73.3 percent – 38 more than in 2016. Germany had 390 in 2017, Italy 201, France 233, and Spain 161.
Many big London-based banks have since opened new hubs elsewhere in the European Union in preparation for business after Brexit.
Britain had opposed the introduction of the bonus cap, saying it would prompt banks to blunt its impact by raising basic pay, making it harder for lenders to cut costs in a market downturn.
EU financial rules have been embedded into UK law as part of Britain’s preparations for Brexit on March 29.
Bank of England Governor Mark Carney has hinted that the bonus cap could be among the bloc’s rules that are reviewed by the UK in future, but not at the risk of damaging overall resilience in the sector.
As bankers come under pressure to rein in bonuses, asset managers are escaping the full impact of the cap.
EBA said that in the banks’ business area of asset management, the average ratio of variable to fixed remuneration increased from 358 percent in 2016 to 402 percent in 2017, still far exceeding the maximum ratio of 200 percent.