Bank of England tells bankers to prepare for pay cuts

The Bank of England's Sir Jon Cunliffe has warned bankers they are paid too much and should expect a pay cut following a sharp drop in banks' profits.

Cunliffe, the Bank's deputy governor for financial stability, said harsher rules for banks forcing them to hold more capital have already impacted shareholder returns but have yet to impact bankers' salaries. He said while banks' profits may recover, pay packets may come under pressure if they do not, especially as regulators do not want to see the excessive risk-taking and leverage which preceded the financial crisis. "The sluggish adjustment in pay [since the crisis] may well reflect the expectation that returns in banking are set to increase in the future," he said. "There are g...