Banks receive bonus cap freedom on current-year compensation arrangements

Banks, building societies and PRA-designated investment firms can remove the bonus cap from their remuneration calculations with effect from 31 October without having to wait, as previously planned, for the start of their next performance year.

By Neasa MacErlean

The withdrawal of the cap ends the restrictions that limited the proportion of overall compensation which could be linked to performance. Firms that take this route will be able to increase the amount of variable remuneration they give to individuals for the portion of the current performance year that falls after that date.