So last month I briefly wrote about the FDICs discussing the regulation of bank executive pay structures. This issue, known as section 956 of the Dodd-Frank Act while still pending approval by different federal members; FFIEC, SEC, and FHA aims to require any depository institutions with assets greater than $1 billion to file an annual report that details the structure of their incentive compensation plans. While institutions over $50 billion have to provide policies for their executives as well as any individuals who have to ability to expose the institution to possible losses related to the size, capital, and/or overall risk tolerance. Along with these restrictions the rule is requiring that at least 50% of the incentive-based pay be deferred for at least three years. So as a stockholder of several financial institutions I’ll be looking forward to their annual reports depicting the new rule if passed. Click here to read more about this regulation.
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