JP Morgan’s British bankers could receive bonuses of up to ten times their salary as it becomes the latest to lift the bonus cap.
The Wall Street titan has removed previous rules introduced by Brussels that limited bonuses to twice an employee’s annual salary.
This means that an employee earning a salary of £200,000 a year at JP Morgan could receive an additional payment of up to £2 million compared to the previous limit of £400,000.
This follows a similar overhaul by rival Goldman Sachs, which now allows its top UK traders and dealmakers to earn bonuses of up to 25 times their base salary.
Remuneration: JP Morgan has removed previous rules introduced by Brussels that limited bonuses to twice an employee’s annual salary.
A JP Morgan spokesperson said: ‘We believe we have developed one of the most attractive and balanced pay structures in the industry.
“Fixed pay will remain very competitive and we will have ample room to appropriately reward top performers.”
Executives at the bank, which employs around 22,000 people in the UK, believe the move will help retain and attract top talent.
The bank is not expected to reduce the fixed salary of existing staff.
The bonus cap rules were first introduced by the European Union in 2014 to curb excessive risk-taking in the industry.
However, opponents of the rule said it simply meant that banks would increase base salaries.
Bank of England Governor Andrew Bailey previously described the policy as “wrong”.
Last year, the Government removed its long-standing cap on bankers’ bonuses as part of a post-Brexit shake-up of City rules.
Goldman said last month its move was driven by a desire to reward success and make Britain more attractive to star bankers. There are around 6,000 workers in Goldman’s London office.
The changes may give London an edge over EU financial capitals such as Paris and Amsterdam, which have been desperate to try to steal London’s crown as Europe’s top financial centre.
