The struggling hedge fund giant Man Group has capped all executive bonuses at 250 per cent of salary in a sweeping overhaul of its pay policy.
The company, which paid no bonuses at all to its top staff after a poor 2012, said its previous salary structure had been "overly complex" and the new plan "will increase transparency and alignment with shareholders whilst reducing the complexity and likely quantum of awards".
The news came as fears mounted across the Square Mile that the cap on bankers' bonuses will spread across the entire financial services sector.
European politicians are expected to widen their clampdown on executive pay to the fund management sector, with draft rules proposing a ban on bonuses that exceed salary.
The rules are likely to affect the asset management, hedge-fund and shadow banking sectors if, as is expected, they are agreed in the European Parliament later this week.