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Several major banks have introduced "allowances" for staff, determined at the beginning of each year and paid out in regular intervalsReuters

European Union regulators are set to consider strengthening rules around bankers' bonuses after some lenders have taken advantage of loop holes in the existing legislation by introducing pay "allowances".

The current cap means bonuses are fixed to no more than an employee's salary or double with shareholder approval for awards in 2014 which will be given next year.

But several major banks have introduced "allowances" for staff, determined at the beginning of each year and paid out in regular intervals, but which are not pensionable or bonuses.

The amount is determined by how senior the banker is.

Sharon Bowles, the Liberal Democrat chair of the European Parliament's economic affairs committee, told Reuters that some lawmakers are complaining the rule is not strict enough and her group would discuss the issue next week.

The BoE's Prudential Regulation Authority (PRA), which regulates the UK financial sector, considers the allowances to be fixed pay.

As a result, the amount of variable pay they can receive under EU bonus rules – which start to be enforced in 2015 – is higher.

The move means the amount of variable pay the bankers can receive under EU bonus rules – which start to be enforced in 2015 – is higher.