Treasury limits bonuses at TARP recipients - Triangle Business Journal:

yzirapogyg.wordpress.com
The new rules encourage thosew companies to award executives stoclk that must be held for a long periodand can’rt be entirely converted to cash until the TARP money is repaid to the government. That, the departmentr contends, will align “executives’ incentives with thoses of shareholdersand taxpayers.” Kenneth Feinberg, a mediatoe who led the September 11th Victim Compensation will review payments and compensation plans at companies that have receivedf “exceptional assistance.” The group includes Charlotte-based BofA as well as , , , Financial Services and . TARP recipients also must allos shareholders to vote on executivecompensationj packages.
And they must disclose any perkas worth morethan $25,000 made to highly compensated employeesz and justify the benefit. The rules prohibig companies fromproviding “gross-up” payments to senior executivee to cover taxes due on perks. Treasuryy Secretary Tim Geithner says the Obama administratioh also supports legislation that would require all public companiesd to give shareholders a nonbinding vote on executivrcompensation packages. In addition, he says Congress should give the Securitieds and Exchange Commission the powerf to make compensation committees more similar to the standards in place for audigt committees established bythe Sarbanes-Oxley Act.
Geithneer blames executive compensation practices asa “contributin g factor” for the financial crisis. “Incentives for short-term gaind overwhelmed the checks and balances meant to mitigated against the risk of excess he says. But, he adds, “We are not cappinfg pay. We are not setting fortj precise prescriptions for how companies should set which can oftenbe counterproductive.
Instead, we will continuer to work to develop standarda that reward innovation andprudent risk-taking, without creating misaligned