Banks in talks to reduce bonuses - graduate jobs

Graduates looking to enter into the banking sector may miss out on big payouts after reports that Britain's biggest banks are in talks to reduce the levels of multimillion-pound staff bonuses.

The BBC reports that negotiations to collectively cut the £7 billion already earmarked for new year payouts are being hosted by the British Bankers Association.

A participant in the private talks told the broadcaster that the bonus pot could be reduced to £4 billion in reaction to the public backlash over the amount of bonuses awarded.

Business Secretary Vince Cable and Deputy Prime Minister Nick Clegg have already issued warnings about the banks' big payouts in light of the state of the economy.

Mr Cable said that a response to the payment of "outrageously large" sums could be to impose more taxes on institutions, while Mr Clegg warned ministers would not stand "idly by" if they handed out huge rewards after being bailed out by the taxpayer.

The outgoing head of business group the CBI also said bankers would seem "arrogant and out of touch" if they carried on paying bonuses while the public sector wrestled with swingeing cuts.

A new levy on banks' balance sheets is due to come into force at the start of next year. Ministers hope it will raise more than £8 billion over the next four years.