Page 44 - EBA 2015.1815 Annual report 2014 web 2

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E U R O P E A N B A N K I N G A U T H O R I T Y
42
Figure 9: Number of high earners over time
3000
3100
3200
3300
3400
3500
3600
0.80
0.79
0.78
0.81
0.82
0.83
0.84
0.85
0.86
Total Number of High earners
EURGBP FX Rate, December
2010
2011
2012
2013
3427
3177
3530
3219
0.844
0.85365
0.81053
0.83215
conditions is it possible to exclude staff identi-
fied only under the quantitative criteria from
the scope of identified staff. Institutions are
required to perform a risk based assessment
before such exclusions are made and notified
to the competent authority, who may request
additional analysis. For staff earning more
than one million euros such exclusions are
only possible in exceptional cases; the EBA
will ensure the consistent application of the
respective provisions.
In 2013, the identification of staff did not yet
follow the criteria defined in the RTS on identi-
fied staff, also the criterion that at least 0.3 %
(as indicated in the graph below) of the staff
with the highest remuneration should be iden-
tified was not yet in place.
The data for 2013 reveals the numbers of iden-
tified staff differs significantly between institu-
tions of different size and in many cases be-
tween institutions of similar size and business
activities. The identification outcomes are
expected to change subsequent to the adop-
tion of the RTS on identified staff, with higher
and more harmonised numbers of staff being
identified. However, this data will only be avail-
able in the second half of 2015.
Standards on instruments
The RTS on instruments broadly define the
instruments that institutions must use, where
possible, in parallel to shares, share-linked
instruments or equivalent instruments. To
ensure a write down or conversion at going
concern conditions, the RTS introduces for all
instruments a uniform trigger event of 7 % of
the Common Equity Tier 1 (CET1) capital and
defines the respective mechanisms. Accord-
ing to the EBA benchmarking results banks
have so far mainly used shares or share-
linked or equivalent instruments for the pay
out of variable remuneration in instruments.
Only in single cases institutions have made
limited use of the possibility to use hybrid in-
struments. However, from 2014 onwards insti-
tutions should use a balance of the different
classes of instruments, where possible.
Remuneration benchmarking and high
earners report
Each year the EBA collects data on staff that
have received remuneration of one million eu-
ros or more in the previous financial year and,
in addition, detailed information in particular
on the remuneration of identified staff from
more than a hundred institutions. The EBA
publishes the aggregated data and a bench-
marking analysis. Both data collections aim
at ensuring a high level of transparency re-
garding the remuneration practices within the
Union. The report published in 2014 analysed
the remuneration developments between 2010
and 2012. Overall, the remuneration paid to
identified staff increased over time. The data
revealed a trend to increase in particular the
fixed remuneration component. However,
further changes to institutions’ remunera-
tion policies were needed in light of the newly
introduced bonus cap and some institutions
have introduced so called ‘role-based allow-
ances’ to increase the supposedly fixed com-
ponent of remuneration. Following changes in