The European Commission is taking a hard look at two of its most debated banking regulations: the cap on banker bonuses and the market risk capital requirements that govern how banks handle their trading books. The review, launched as a targeted consultation on February 11, 2026, represents Brussels’ clearest acknowledgment yet that its regulatory framework might be putting EU banks at a disadvantage.
The consultation runs until April 19, 2026 and focuses squarely on the EU’s single rulebook, the unified set of rules that governs how banks across the bloc operate. Two areas are getting the most attention: remuneration rules that limit how much bankers can earn in bonuses relative to their fixed pay, and the Fundamental Review of the Trading Book, or FRTB, which dictates how much capital banks must hold against market risk.
The bonus cap problem
The EU’s bonus cap has been a sore spot since it was introduced during the CRD IV era back in 2013. The rule limits variable pay relative to fixed pay for bankers, and it was designed to curb the kind of reckless risk-taking that contributed to the 2008 financial crisis.
The UK scrapped its own version of the bonus cap after Brexit. That means London-based banks can now offer more flexible compensation packages, making it easier to attract and retain top talent.
