WASHINGTON–While the credit union trade groups have called NCUA’s proposed rules around CU executive compensation and incentives unnecessary and burdensome, those rules pale when compared with what other financial regulators have proposed for bankers.
The rules, required by the Dodd-Frank Act and a reaction to big pay packages that were said to contribute to the financial and Wall Street meltdown, require top executives at banks to defer as much as 60% of their compensation for as long as four years. Current rules call for deferring one-third of the compensation for Wall Street’s big earners for three years.
The most stringent of the proposed rules from the bank regulators apply to the largest of financial institutions, those larger than $50 billion, a category into which just one credit union—Navy Federal—falls.
The new bank rules also give banks up to seven years to claw back bonuses if it should be discovered later there was any misdeeds on an executive’s part.
Coverage of NCUA’s proposed rules can be found here.