For a moment, it looked like the last remaining pay party in the City of London was about to be snuffed out.. There was a possibility that the European Union's punitive bonus cap was going to be applied to all finance firms - however diminutive. Today, the UK Financial Conduct Authority and Prudential Regulation Authority made it clear that this won't be the case.
Instead, the FCA said regulators will continue with their "current approach," which simply states that smaller firms need to pay an appropriate (and unspecified) mix of salaries and bonuses.
In practice, Sam Whitaker, a counsel at law firm Shearman & Sterling in London, says this means all firms rated as "tier 3" and below by the FCA won't have to apply the strict EU bonus rules. These firms will still be free to allocate a higher proportion of compensation to bonuses, and to pay a far higher proportion of those bonuses in cash.
Which are these tier 3 firms? Unfortunately, there's no definitive list. The only way of finding out whether a firm is classified as tier 3 or not is to trawl its 'pillar three submissions' with the regulator.
Having done this, we can inform you that some of London's most generous firms fall into the tier three 'pay-as-you-like' category. They include Brevan Howard, Blackrock, Vanguard and Jefferies.
Brevan Howard's most recent pillar three disclosure reveals that it paid 18 code staff in London an average of £844k ($1.2m) each for the year ending March 2015. For the year ending December 2014, Vanguard says it shared £8.4m between so few people in London that it would be unreasonable to state how many of them there were. And Blackrock paid £200m to no more than 500 people (the total number it has registered with the FCA in London) over the same period.
If you want a big cash bonus in the City, these are the sorts of firms you should be working for.
However, one bank towers above the rest when it comes to paying giant amounts in cash. And that bank is....Jefferies.
Jefferies has been paying cash bonuses in London for at least four years. As a tier three firm, it is now free to continue doing so indefinitely.
Jefferies hasn't released a Pillar 3 regulatory disclosure for a while. However, its last one, covering the year to November 2014, shows that - on average - each of its 32 London code staff were paid as follows:
More to the point, there was none of the waiting around for five years until bonuses vest that you get in major banks. The last time it made a regulatory filing, Jefferies said it paid its bonuses, "in up-front cash." Jefferies' traders will be relieved to learn that as of today, it's free to continue doing so.