The banking unit of the Virgin Group headed by Sir Richard Branson, will join other lenders this week to announce that it backs high bonuses for bankers in the UK.

Virgin Money is planning to announce higher bonus for its senior executives, a move that might be against new European rules. The bank is expected to announce that its board has approved a plan to award up to 200 per cent of the salaries of top executives as bonuses. The bank said that bonus decision is restricted under the new European rules.

The European Commission has ruled that banks cannot pay more than two times a banker's salary in bonuses. Bank of England governor Mark Carney has dismissed proposals to cap bankers' bonuses and described it as a crude measure that is expected to fail to meet its objectives. He said that the move will simply enable the banks to increase the basic salaries of its executives in order to retain talent. The remarks were made at a time when the Royal Bank of Scotland is planning to give senior staff bonuses worth twice their salaries.

Bankers in the leading financial hub of London are particularly concerned over the limits but experts believe most of them already have ways to circumvent the new legislations. Experts said that if there are restrictions on paying bonuses, the bankers will simply increase other allowances for the officials.

Source: Top News