ABSTRACT
Rebuilding trust in banks has been one of the most contentious challenges for governments across Western jurisdictions since the global financial crisis (GFC). This chapter presents a legal analysis of the most significant reforms made since the GFC to the regulatory framework governing bankers' compensation and sanctioning powers in the United Kingdom (UK). It discusses these reforms and analyse some of their limitations. On the basis of the recommendations of the Parliamentary Commission on Banking Standards (PCBS), in 2013, Parliament enacted the Financial Services Act. The Act, inter alia, establishes a new senior managers' regime' (SMR) at certain financial institutions, which extend the approved persons' (AP) regime under the Financial Services and Markets Act 2000. Senior managers at financial institutions are therefore under pressure to comply with shareholder risk-preferences across the board, irrespective of their individual risk appetites.
