On May 16, 2016, six federal agencies – the Federal Deposit Insurance Corporation, the Federal Housing Finance Agency, the Federal Reserve Board of Governors, the National Credit Union Administration, the Office of the Comptroller of the Currency and the Securities and Exchange Commission – requested public comments on proposed rule that would “prohibit incentive-based compensation arrangements that encourage inappropriate risks at covered financial institutions.” Comments must be submitted by July 22, 2016. Release.
incentive-based compensation
Proposed Rule on Disclosure of Incentive-Based Compensation
On March 29, the SEC, Fed, FDIC, FHFA, NCUA, OCC, and OTS requested comment on a joint proposed rulemaking to implement Section 956 of the Dodd-Frank Act. The proposed rule prohibits incentive-based compensation arrangements that encourage inappropriate risk-taking by covered financial institutions and are deemed to be excessive or that may lead to material losses. Comments must be submitted within 45 days after publication in the Federal Register, which is expected soon. Joint Release. Proposed Rule.
FDIC Approves Proposal for Incentive-Based Compensation
On February 7, the FDIC approved a joint proposed rulemaking to implement Section 956 of the Dodd-Frank Act. Section 956 prohibits incentive-based compensation arrangements that encourage inappropriate risk-taking by covered financial institutions and are deemed to be excessive or that may lead to material losses. Comments must be submitted within 45 days after publication in the Federal Register. FDIC Release. Proposed Rule.