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ECB to put bankers’ pay under microscope

The European Central Bank will more closely scrutinise pay for bankers at lenders under its supervision to make sure it encourages financial stability, a top official said Thursday.

“We will take a close look at remuneration schemes to see whether they are conducive to the sound and prudent management of banks,” ECB Supervisory Board Chair Daniele Nouy said at a Frankfurt conference.

As the top enforcer of eurozone banking rules, the ECB “will asses whether these schemes are in line with European standards” laid down by the European Banking Authority, she added.

Nouy’s vow to probe bankers’ pay packets followed a public outcry after top German lender Deutsche Bank’s decision to quadruple bonus payouts for 2017, to 2.2 billion euros ($2.5 billion), despite making a 751-million-euro loss last year.

Most of the cash will go to the investment banking division, whose revenue slumped 16 percent year-on-year.

Deutsche Bank chief executive John Cryan said it was important to invest in the division’s 17,000-strong staff, largely made up of traders and advisors who could be lured away to competitors.

jpl/tgb