Tomahawk, WI 02/06/2014 (BasicsMedia) – Bank of America Corp (NYSE:BAC) operates an investment division in Europe. This large American bank intends to raise the salaries of some of its managing directors who work at its European stations by as much as 20 percent. The bank will see these directors earn upwards of $500,000 once the all the major and minor details are sorted out. This increase in salaries will apply to those managing directors whose work requires them to meet with clients on a regular basis. The salary increment takes place with immediate effect, and without further delay.

Bank of America Corp (NYSE:BAC) has carried out this increment in the midst of too much pressure by European regulators. Europe has passed laws and regulations that are very strict on matters to do with bonuses among countries that operate within the boundaries of the European Union. The new laws that Europe intends to pass, will outlaw any bonuses that top executives receive, as long as these are twice the fixed pay of such employees. European lawmakers believe that this form of risk-taking is partially responsible for the mess that led to the 2008 financial crisis inn the region.

Bank of America Corp (NYSE:BAC) is just but one of the major banks that are looking for ways of sidestepping these new rules that apply to their operations in Europe. The new rules will take effect from 2015, and will be based on how the banks and other similar companies perform this year. Banks need to reward their employees well, if they hope to attract the best talents that are out there in the market. Attracting the best talent would be impossible without giving them pay that match with the skills they are bringing in; hence the decision by BAC to raise salaries.

If any staff within the banks earns more than $1.3 million, they are allowed to apply for a waiver so that the new rules do not apply to them. This is according to the European Banking Authority, which has the mandate of approving any such deal or request. The EBA does not have to ascent to all these requests all the time. It has the power to say no to such requests from banking institutions operating in Europe and with the intention of giving their top executives bonuses. On the other hand, senior managers working for the banks do not qualify for such exemptions.

Investment bankers seem to prefer Britain to other countries that are part of the European Union. Britain currently has around 2,188 investment bankers, compared to 37 in Spain, 117 in France, and 100 in Germany. What all these investment bankers share in common is that they earn more than $1.3 million, as per the figures released in 2012. There are more bankers working within this jurisdiction, but they do not earn anywhere near $1.3 million. Many investment banks, not only Bank of America Corp (NYSE:BAC), are in advanced stages of raising their employees’ pay.

If this move helps Bank of America Corp (NYSE:BAC) to retain its top executives by rewarding them well, then it has the potential of stabilizing its operations in Europe, which would bode well for all involved.

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