Fed, FDIC Say Bank Pay Should Not Reward Risk

Law360, New York (June 22, 2010, 7:11 PM EDT) -- A number of federal financial agencies have put forth new guidelines to make sure incentive compensation arrangements at financial firms take into account risk and are consistent with safe and sound practices.

The Federal Reserve, the Federal Deposit Insurance Corp., the Office of the Comptroller of the Currency and the Office of Thrift Supervision announced the promulgation of the guidelines on Monday, noting that the Federal Reserve had proposed the guidance in 2009.

The guidance is based on three key principles about incentive compensation arrangements at...
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