"Under the new rules, the deferral period for senior bankers' bonuses will be halved from eight years to four, while some payments will be allowed from year one. Thresholds have also been adjusted so that the requirement to defer a large portion of pay applies only above £660,000, and restrictions on the mix of cash and shares have been eased."
"They're comparatively modest for one thing. But, relaxing the rules on banker bonuses is a smart move for the UK economy nonetheless. Quicker payouts don't just mean faster tax receipts for the Treasury - they also unleash spending power straight into the real economy. From property and home improvements to restaurants, holidays, and retail, these payments support jobs across a wide range of industries. Many bankers also back UK start-ups with their bonuses, helping to fund innovation, build companies, and create employment."
The deferral period for senior bankers' bonuses will be halved from eight years to four, and some payments may be made from year one. The deferral requirement will apply only to pay above £660,000, and restrictions on the mix of cash and shares have been eased. The reforms aim to strengthen the City's global competitiveness and boost economic activity by speeding payouts and increasing spending power. The changes take effect on 16 October 2025 and will apply to the 2025 bonus round and to existing but unpaid bonuses. Faster payouts are expected to increase consumer spending and support jobs and start-ups.
Read at London Business News | Londonlovesbusiness.com
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