Filenews 19 August 2021 - by Theano Thiopoulou
Banks' shareholders are generous for the remuneration of their senior executives, a key incentive to achieve the goals set for implementation by the boards of directors.
Seven bankers in Cyprus had fees of €10.43 million. in 2019 according to data released yesterday by the European Banking Authority. In total, the fixed fees of golden boys in the domestic banking system reach €6.70 million. and variables correspond to €3.82 million. It is worth noting that all 8 bankers are in managerial positions and none in retail banking.
According to ETA, Cyprus had two bank managers in 2019 with a fixed payroll of €3.73m. and variable payroll (bonus) of €918,000. The average total remuneration of senior executives per person in Cyprus is €2.32m. In Austria, the average remuneration of senior bank executives is €2.03 million, in Belgium €1.53 million, in the Czech Republic €1.30 million, in Denmark €1.49 million, in Finland €2.13 million, in France €2.37 million, in Germany €1.76 million, in Greece €2.19 million, in Ireland €2.87 million, in Italy €2.17 million, in Luxembourg €1.77 million, in Portugal €1.23 million, in Slovenia €1.40 million, in Spain €3.85 million, in the United Kingdom €2.67 million.
The analysis of the European Banking Authority shows that in 2019, 4,963 people working for EU banks received more than €1 million in remuneration which is mostly the same as in 2018. The average ratio between variable and fixed pay for high earners decreased from 139% in 2018 to 129% in 2019. The preparation of institutions for the UK's withdrawal from the EU has affected the distribution of high-earners across the EU.
Countries with an increase
In 2019, the largest share of high earnings of 3,519 (71% of the total number of high earners) was found in the UK. Most Member States across the EU recorded a slight increase in the number of high-paid people, particularly those of Germany, France and Italy. The increase in high incomes resulted mainly from the impact of the relocation of staff from the UK to the EU-27 in the context of Brexit preparations. Moreover, for some institutions, overall good financial results, particularly in corporate banking, and ongoing restructuring and consolidations, which have led to higher than usual compensation, play an important role in the overall growth of high-wage earners.
According to the Report of the European Banking Authority, the average ratio between the variable and stable components for all high-wage earners decreased from 139% in 2018 to 129% in 2019. In the asset management business segment, the average variable-to-fixed remuneration ratio decreased from 378% in 2018 to 339% in 2019, far exceeding the maximum ratio of 200%. This is mainly due to differences in the national application of the Capital Requirements Directive (CRD), which in many cases allows for exemption from certain provisions when certain criteria are met. Following the CRD amendments, which entered into force at the end of 2020, a higher degree of harmonisation is expected.
The report was prepared in accordance with Article 75(3) of the CRD, which instructs the EDF to collect information on the number of persons per institution paid one million euros or more per financial year (high-paid), including the main salary elements such as bonuses.
The UK will be off the list
The report includes data reported by UK institutions on high-wage earners as well as during the transition period. UK institutions continued to report data on high incomes at EU consolidation level, covering all subsidiaries and branches established in the EU Member States. ETA will continue to assess earnings trends every six months (e.g. for the 2019 and 2020 performance years, a benchmarking exercise will take place in 2021 and will be published in the first quarter of 2022). In addition, the EBA will continue to publish annual data on high-wage earners to closely monitor and assess developments in this area. The next report based on 2020 data will no longer include data for the UK.
