In response to the UK Government’s legal challenge to the remuneration provisions in CRD4, Simon Lewis, chief executive, the Association for Financial Markets in Europe (AFME) said:

“The banking industry has already made, and continues to make, progress in changing remuneration policies and addressing the issues around variable pay and its relationship to performance and risk. 

“We believe that the remuneration provisions in CRD4 would add nothing more in tackling these issues and would have a number of unintended and negative consequences for Europe’s banks.  

“In particular the CRD4 provisions would increase the fixed cost base of the industry whilst also undermining the competitive position of a vital economic sector. We therefore welcome this opportunity to review the remuneration provisions of the CRD4 proposals.”