The gender pay gap has worsened across many of the City’s biggest banks in signs that men are reaping an increasingly large share of bonus pools, new figures reveal today.
The difference in average bonuses between men and women has widened in 11 out of 18 banks, according to government gender pay data analysed by the Standard.
Men now get more than 10 times the median bonuses that women do at NatWest, a deterioration on last year, while at Lloyds, the median bonus pay gap has widened by 21 percentage points such that women now earn 59% less than men. At Barclays, the bonus gap has worsened to 61%, and at HSBC it contracted slightly to 74% but remains among the highest.
Almost all US investment banks have seen their bonus pay gap worsen in the UK compared with last year — while at Goldman Sachs it widened to its worst in six years.
Supermarket-owned banks have also fared poorly, with the median bonus gap at Sainsbury’s Bank increasing by 25 percentage points to 71%, and Tesco Bank reversing a zero bonus gap last year to a 50% differential this year.
The EU’s bonus cap rule — which restricts the size of banker bonuses as a proportion of fixed pay — was axed in the UK at the end of October last year, after the move was announced by Kwasi Kwarteng during his short stint as Chancellor in 2022. That suggests men are disproportionately benefiting from the lifting of restrictions and the gender gap in bonuses could get even larger next year.
City Comment: Scrapping the bonus cap has only widened the City’s gender inequality
By contrast, London’s biggest fintechs and digital banks showed signs of significant improvement. The bonus pay gap at Monzo was zero for the second consecutive year, while at Revolut it was reduced from 49% to zero. At Starling, the first British bank to have been founded by a woman, the bonus pay gap skewed slightly in favour of women.
Revolut said its improvement was driven by an increased representation of women in the highest pay quartiles. That was the result of a new promotion policy, which elevated women’s representation from 35% in 2022 to 44% in the 2023 promotion cohort.
Janine Hirt, CEO of Innovate Finance, said: “It is fantastic to see that fintechs are leading the charge in closing the gender pay gap. This commitment to equality within their own organisations is directly in line with their drive to foster a financial services sector that is more inclusive and democratic with diverse customers and consumers at its heart.
“By championing gender parity, fintechs set a powerful example for the broader financial services sector about how greater diversity is key to innovation, progress and success.”
