Cityam – Would an EU cap on bankers’ pay damage London’s ability to attract the best

Any EU-wide limit on bankers’ remuneration will, in likelihood,

create anguished complaints of “business prevention” , “restraint of

trade” and “anti-capitalist tendencies”. But in reality, it will not

cause too much physical upheaval. Most bankers either do not earn

enough, or are not sufficiently mobile, to allow them to move to an

appropriate location outside the EU like New York or Hong Kong.

Indeed, such is the shrinkage within global financial services hiring

at present, there is no guarantee that even a senior banker could

move to one of these locations unless there was a strong need

within their existing company, or they had specific skills in demand

in those places. Of course, the size of the cap is pivotal. There’s a

reason remuneration is also termed “compensation”. If the cap is

sufficiently harsh, it could force some people to move abroad for

more junior roles than they might have otherwise accepted.

Paul Chapman is managing director of Hornby Chapman.