European bonus curbs 'will not prompt talent exodus'

Europe's controversial restrictions on bank bonuses will not force top executives to seek employment in Asia, EU financial services chief Michel Barnier has claimed.

Speaking to the British government's Treasury Select Committee, he described claims of this nature from the European banking community as "blackmail".

"I very much doubt there will be a flight of talent towards Asia or elsewhere," Mr Barnier said in comments reported by Reuters.

Finalised by the Committee of European Banking Supervisors last week, the new rules on remuneration were met with outrage by the continent's major financial centres.

The guidelines, which have been described as the toughest in the world, will mean bankers can receive no more than 30 per cent of their bonuses in upfront cash payments.

Due to apply from January 1st 2011, the rules will cover the forthcoming bonus round in the financial services industry.

However, the Guardian reported that many large banks are expected to sidestep the crackdown by increasing basic salaries.