The British government will extend cap cash bonuses at the state-rescued Royal Bank of Scotland, Prime Minister David Cameron said on Wednesday.
Cameron also promised to veto any increase in the overall pay bill at the institution, which faces public anger over a vast bailout at the height of the financial crisis. But bankers at RBS could still be in line for bumper bonuses paid in shares.
Labour had called on the government to reject a request from the bank for permission to pay bonuses of up to double an employee's annual salary.
"I can confirm today that just as we have had limits on cash bonuses of £2,000 at RBS this year and last year, we will do the same next year as well," Cameron told parliament.
"If there are any proposals to increase the overall pay, that is pay and bonus bill at RBS, at the investment bank, any proposals for that, we will veto it."
The European Parliament agreed last year to cap bonuses for bankers at the same amount as is paid in a fixed annual salary, or twice that sum if shareholders approve.
But Britain is challenging the law at the European Court of Justice, arguing the bonus ceiling is impractical and would make Europe's banking sector uncompetitive.
RBS is currently 81-percent-owned by the British government after the world's biggest bank bailout following the 2008 financial crisis.