BPI Statement on Incentive Compensation Proposal

Washington, D.C. —BPI President and CEO Greg Baer issued the following statement on today’s OCC and FDIC proposal on bank incentive compensation: 

“Today’s action by the FDIC and OCC is purely political. They have agreed on a proposal, which they acknowledge is legally ineffective, to send a political message. As with its 2016 ancestor, the proposal is inconsistent with the statute they purport to be implementing, and an attempt to govern how financial services sector employees are paid, rather than a fact-based determination that certain pay practices are risky and should be prohibited, consistent with the statute. A statutorily compliant rule would not have been hard to write: it would have required an analysis of past pay practices, with a narrow prohibition of a few of them. As Chair Powell said recently at a Congressional hearing, ‘I would like to understand the problem we’re solving and then I would like to see a proposal that addresses that problem.’ But statutory compliance and safety and soundness did not appear to be on the agenda for these agencies. Indeed, the meeting itself was not on the agenda, as the FDIC acted by notational vote.”

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About Bank Policy Institute.

The Bank Policy Institute (BPI) is a nonpartisan public policy, research and advocacy group, representing the nation’s leading banks and their customers. Our members include universal banks, regional banks and the major foreign banks doing business in the United States. Collectively, they employ almost 2 million Americans, make nearly half of the nation’s small business loans, and are an engine for financial innovation and economic growth.

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Sean Oblack
Bank Policy Institute
sean.oblack@bpi.com

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