Germany's Cabinet approved a bill Tuesday that would limit bankers' pay and bonuses in line with recommendations made by the Group of 20 industrialized and developing nations.

The Finance Ministry said in a statement that the bill proposes changes in laws on oversight of financial and insurance companies that would take effect by October.

The new regulations would give Germany's financial services regulator, BaFin, greater power to oversee pay and bonus distribution. For instance, BaFin might get the power to block or curtail bonuses to bankers whose banks do not meet liquidity and credit requirements. Restrictions might also be imposed on employees of banks at risk of missing those requirements, the statement said.

The bill requires approval by both houses of the German parliament.

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