EBA Report on Benchmarking of Remuneration Practices in EU Banks
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.
Related Links
Keywords: Europe, EU, Banking, Benchmarking, Remuneration, EBA
Previous Article
RBNZ Consults on Framework for Identifying D-SIBsRelated Articles
BIS and Central Banks Experiment with GenAI to Assess Climate Risks
A recent report from the Bank for International Settlements (BIS) Innovation Hub details Project Gaia, a collaboration between the BIS Innovation Hub Eurosystem Center and certain central banks in Europe
Nearly 25% G-SIBs Commit to Adopting TNFD Nature-Related Disclosures
Nature-related risks are increasing in severity and frequency, affecting businesses, capital providers, financial systems, and economies.
Singapore to Mandate Climate Disclosures from FY2025
Singapore recently took a significant step toward turning climate ambition into action, with the introduction of mandatory climate-related disclosures for listed and large non-listed companies
SEC Finalizes Climate-Related Disclosures Rule
The U.S. Securities and Exchange Commission (SEC) has finalized the long-awaited rule that mandates climate-related disclosures for domestic and foreign publicly listed companies in the U.S.
EBA Proposes Standards Related to Standardized Credit Risk Approach
The European Banking Authority (EBA) has been taking significant steps toward implementing the Basel III framework and strengthening the regulatory framework for credit institutions in the EU
US Regulators Release Stress Test Scenarios for Banks
The U.S. regulators recently released baseline and severely adverse scenarios, along with other details, for stress testing the banks in 2024. The relevant U.S. banking regulators are the Federal Reserve Bank (FED), the Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC).
Asian Governments Aim for Interoperability in AI Governance Frameworks
The regulatory landscape for artificial intelligence (AI), including the generative kind, is evolving rapidly, with governments and regulators aiming to address the challenges and opportunities presented by this transformative technology.
EBA Proposes Operational Risk Standards Under Final Basel III Package
The European Union (EU) has been working on the final elements of Basel III standards, with endorsement of the Banking Package and the publication of the European Banking Authority (EBA) roadmap on Basel III implementation in December 2023.
EFRAG Proposes XBRL Taxonomy and Standard for Listed SMEs Under ESRS
The European Financial Reporting Advisory Group (EFRAG), which plays a crucial role in shaping corporate reporting standards in European Union (EU), is seeking comments, until May 21, 2024, on the Exposure Draft ESRS for listed SMEs.
ECB to Expand Climate Change Work in 2024-2025
Banking regulators worldwide are increasingly focusing on addressing, monitoring, and supervising the institutions' exposure to climate and environmental risks.
