Big Wall Street firms and leading European banks have agreed to implement compensation reforms in their UK operations, the British Treasury department reported Wednesday.

Bank of America Merrill Lynch, Citigroup, Credit Suisse, Goldman Sachs International, JP Morgan Securities Ltd, Morgan Stanley, Nomura and UBS have confirmed their commitment to the UK Financial Services Authority’s rule and supporting code on remuneration practices, which was published in August and comes into force on January 1, 2010, the Treasury said; adding that the banks also pledged their full support for the G20 agreement, which sets global standards for the implementation of the Financial Stability Board’s remuneration principles.

Additionally, European banks with major London branches, BNP Paribas, Deutsche Bank and Société Générale confirmed that they will implement the G20 agreement in accordance with their home regulator and would seek to voluntarily comply with the FSA rule on remuneration for their UK based employees, it noted.

In a joint statement, the banks said, “In a competitive and global business, banking remuneration must be consistent with effective risk management and there must be national and international consistency on this issue. We welcome the global nature of the G20 remuneration reforms and will work with the FSA and regulators in our home countries in adopting the reforms, recognising that all G20 nations have also committed to their implementation to ensure a level playing field.”

Last month, five of the UK’s biggest banks also promised that they would implement the reforms, too.

“The financial services industry must take a responsible and long-term approach to remuneration if it is to retain its competitiveness and regain public trust. I am pleased that the most significant banking institutions operating in the UK have moved quickly and are supporting our implementation of the agreement reached on bank remuneration at the G20, and this reinforces the standard we have set for other financial institutions and countries to follow. I will be writing to the chairs of their parent companies’ remuneration committees to share with them the outcome of this meeting,” said the UK’s Financial Services Secretary, Lord Myners.

IE