UK capital has most of Europe’s ‘fat cat’ bankers

The vast majority of Europe’s “fat cat” bankers continue to earn their gilded crusts in London’s financial district, despite the United Kingdom’s pending exit from the European Union and the cloud of uncertainty that casts over the financial sector.

New data from the European Banking Authority shows 4,859 bankers and fund managers earned 1 million euros ($1.13 million) or more in Europe in 2017, which was up 6 percent on 2016. Of those, 3,567 were based in London. Germany, which has campaigned to attract banks and financial services companies since the Brexit decision, only had 390 such earners, while France had 233.

The Financial Times said the figures underscore how few senior financial sector jobs had left London as of 2017, despite widespread fears of an exodus.

The paper said many banks and financial companies have, however, drawn up contingency plans that include the relocation of some functions and staff to mainland Europe in the event of the UK leaving the EU without a separation deal that guarantees a close trading arrangement and tariff-free access to EU markets.

More than half of the high-earners working in London’s financial sector in 2017 were involved in investment banking while 430 were in asset management.

The European Banking Authority’s analysis found Britain’s best-paid investment banker made 17.8 million euros in 2017, and 29 other bankers each made more than 10 million euros. One UK-based money manager on a basic salary of 2.6 million euros got an additional 38.3-million-euro bonus, which meant the person raked in 41 million euros in total.

Luke Hildyard, director of the High Pay Centre, told the Guardian newspaper reform of the banking sector is needed.

“Much of the revenue used to pay these rather vulgar sums of money comes from leaching wealth off the real economy, rather than creating it,” he said. “There is a great deal of reform needed to create a socially useful banking industry, and better governance of pay-setting processes should be part of it.”

The European Banking Authority has been monitoring bankers’ payever since the European Parliament called for closer scrutiny following the 2008 financial crisis. Banks have since been compelled to be more transparent over executives’ earnings, both in terms of basic pay and bonuses.

Accountancy consultants EY predictsLondon’s financial sector could lose 7,000 jobs as a result of Brexit. Some 1.1 million people worked in the sector in the UK in 2017, contributing 119 billion pounds ($157 billion) to the nation’s economy, some 6.5 percent of total economic output, according to government figures.

Human resources company Emolument, meanwhile, released the results of its analysis of 4,475 salaries and bonuses paid bankers working in London, Paris, Frankfurt, and Milan, and found the UK capital was the most rewarding place to work in terms of pay.