Bankers’ bonus cap will not cut risk

Capping bankers’ bonuses will not cut risk in the financial system, the IMF said yesterday, offering Britain moral support in its legal challenge to EU curbs on pay in the financial sector.

In its latest Global Financial Stability Report, the IMF looks at pay in the banking sector, saying that excessive risk taken by lenders contributed to the global financial crisis.

Reforms have sought to foster more prudent behaviour by banks, including how pay packets are structured.