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April 10, 2018

EBA published its report on benchmarking of remuneration practices in EU banks for 2015 and 2016 (financial years) and high earners data for 2016. The data show decrease in high earners in 2016 and differences in remuneration practices across the EU.

The data show that, in 2016, the number of high earners in EU banks receiving a remuneration of more than EUR 1 million decreased by 10.6% (from 5 142 in 2015 to 4 597 in 2016); the decrease was mainly driven by changes in the exchange rate between EUR and GBP, which led to a reduction of staff income paid in GBP when expressed in EUR. In addition, for high earners, the average ratio between the variable and fixed remuneration continued to decrease from 127% in 2014 to 118% in 2015 and 104% in 2016. As in the previous years, the report shows that remuneration practices within institutions were not sufficiently harmonized. The application of deferral and payout in instruments differed significantly across member states and institutions. This is mainly due to differences in the national implementation that in many cases allow for waivers of these provisions when certain criteria are met. To address this issue, EBA had published, in 2015, an opinion on the application of proportionality in the area of remuneration.

The report is part of EBA's monitoring activities and focuses on the identification of staff, the application of deferral arrangements, the payout in instruments, and the use of specific remuneration elements—for example, guaranteed variable remuneration and severance payments. The report has been developed in accordance with Article 75 (paragraphs 1 and 3) of the Capital Requirements Directive or CRD IV (2013/36/EU). It contains an analysis of the 2016 data reported for high earners and an analysis of the 2015 and 2016 remuneration benchmarking data, containing information on all identified staff. EBA will continue to benchmark the remuneration trends every two years. For the performance years 2017 and 2018, EBA will publish a benchmarking report at the beginning of 2019.

 

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Keywords: Europe, EU, Banking, Benchmarking, Remuneration, EBA

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