Darling urges EU on curbing bonuses

LONDON: Chancellor of the Exchequer Alistair Darling on Thursday urged the European Union to clamp down on bankers' bonuses, after five of the country's biggest banks signed up to new rules on payments.

Darling said tough rules must be implemented "without delay," as European finance ministers prepared to gather in Sweden for talks on regulation in the wake of the financial crisis.

"I urge all EU colleagues to take similar measures as quickly as possible, and look forward to discussing national implementation plans," Darling wrote in a letter to Swedish Finance Minister Anders Borg ahead of Thursday's talks.

Barclays, HSBC, Lloyds, Royal Bank of Scotland, and Standard Chartered announced Wednesday they would implement changes to pay structure agreed at the G20 summit in Pittsburgh last week.

"The UK's top five banks have committed to leading the way in implementing reforms to bank remuneration agreed by the G20 in Pittsburgh," Darling said in a joint statement with the banks.

The reforms are linked to long-term success, not short-term risky behaviour and include the right to claw back bankers' bonuses if performances are poor.

The banks agreed to work with the financial watchdog, the Financial Services Authority, on implementing the rules.

Curbing bonuses is part of tougher regulation agreed at the G20 to tackle systemic weaknesses that led to the global financial crisis.

Many blame high bonuses for encouraging excessive risk-taking that led to the worst economic downturn since the 1930s.

France's President Nicolas Sarkozy was due to meet Thursday with the heads of French banks to review the G20 proposals and announce his governments planned measures, his office said.

Banks in the Netherlands, not a member of the G20, imposed their own limits on executive bonuses and salaries earlier this month.