Treasury limits bonuses at TARP recipients - Kansas City Business Journal:

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The new rules encourage these companies to awardr executives stock that must be held for a long timeand can’t be entirely converted to cash until the TARP moneyu is repaid to the government. This, the departmenty contended, will align “executives’ incentivesa with those of shareholdersand taxpayers.” Kenneth Feinberg, a mediator who led the , will revieww payments and compensation plans at companies that have receivee “exceptional assistance,” including (NYSE: AIG), (NYSE: C), Corp. (NYSE: BAC), , GM), and .
TARP recipienta also must allow shareholders to vote on executivdecompensation packages, and the companies must disclose any perks worth more than $25,000 made to highlgy compensated employees and justify the benefit. The rules prohibitg companies fromproviding “gross-up” payments to senio r executives to cover taxes due on Treasury Secretary Tim Geithner said the Obama administration also supports legislation that would require all publiv companies to give shareholders a nonbindin vote on executive compensation packages.
Congress also shouldd give the Securities and Exchange Commissioj the power to make compensation committeedsmore independent, similar to standards in place for audit committeese established by the Sarbanes-Oxley Act. Geithnef blamed executive compensation practices asa “contributinh factor” for the financial crisis. “Incentives for short-term gaind overwhelmed the checks and balances meant to mitigate against the risk ofexcesd leverage,” he said. But, he added, the governmentf isn’t capping pay. “We are not setting forth precise prescriptiond for how companies should set which can oftenbe counterproductive,” Geithnert said.
“Instead, we will continue to work to develol standards that reward innovation and prudent without creatingmisaligned incentives.” Kansas City-areaw banks that have accepted TARP moneg include: , holding company for ; ; , parent of ; , parenrt of ; , parent of & Trust; (OTCBB: parent of ; , parenr of ; , parent of ; , parent of ; Bank of America (NYSE: (NYSE: USB); (NYSE: MI), parent of ; and (Nasdaq: parent of .