Foreign banks agree FSA pay rules

Citigroup offices at Canary Wharf, London

Citigroup is among the banks that has agreed to the FSA's rules on pay

Major overseas banks operating in London have agreed to implement rules on remuneration, the Treasury has said.

In August, the Financial Services Authority published a code on bankers' pay, due to take effect from January.

Last month, the five biggest banks in the UK agreed to accept the rules on pay, and they have now been followed by eleven foreign banks.

There must be "national and international consistency" on the issue of pay, the banks said in a statement.

The FSA rules say that bonuses should not be guaranteed for more than a year, and that senior employees should have their bonuses spread over three years.

However, there are no enforced caps on bonuses.

Last month, G20 leaders agreed to introduce rules on pay, and it is down to individual countries to implement them.

The banks that have signed up include US banks Merrill Lynch, Bank of America, Citigroup, Goldman Sachs, JP Morgan and Morgan Stanley.

The others are: Credit Suisse, Nomura, UBS, BNP Paribas, Deutsche Bank and Société Générale.

On Thursday, Goldman Sachs is expected to report large profits, leaving it with a bonus pot of about $20bn (£12.5bn) - the biggest in the company's history.