Davos 2014: Boris Johnson says 'don't block RBS bonuses'

"RBS is still a state-owned bank but it has to be competitive in the market," Mr Johnson said.

"That is the issue they face. In the end people will find a way of rewarding talent irrespective of what Brussels says.

"I don't think it is the business of politicians to try and regulate salaries."

Asked if it was up to the RBS board and management what they decided to pay their top performers, Mr Johnson said: "I would stick at that."

The Mayor of London is at the World Economic Forum in Davos to encourage investment in London for house building and infrastructure projects.

"I have never known sentitment to be so strong in favour of the UK and particularly in favour of London. There is a huge amount of investor interest," he said.

"We need to drive that to create new homes for London. People need to understand this is win-win."

Although Mr Johnson said he was concerned about a housing bubble developing in the capital, he said that Help to Buy was not the problem.

Last week Nigel Wilson, the chief executive of Legal & General, said that Help to Buy should be scrapped in London because it was stoking up demand. Last year house prices rose by 15pc in the city.

"Supply is the issue," Mr Johnson said. "These houses that are being built are not for global plutocrats - they are for Londoners. They will be affordable.

"There has been very little take up of Help to Buy in London so I don't think it can be having that effect [of creating a bubble]. It is playing a role in stimulating supply."

Mr Johnson said public authorities like the NHS and the Ministry of Defence had to speed up the release of under-utilised public land for development

"We need to go faster," he said. "Brownfiled sites are there, the population of London is lower than in 1939."

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