No CRS summary available for this bill.
This section sets forth congressional findings that improper compensation structures have contributed to U.S. financial crises since at least the 1929 Wall Street crash, including by incentivizing short-term risk-taking ahead of the 2008 crisis and Great Recession and the 2023 failures of banks such as Silicon Valley Bank.
This section requires each covered financial institution with more than $1 billion in consolidated assets, and each subsidiary, to defer at least 50 percent of any senior employee’s annual compensation above seven times the median employee compensation into a dedicated deferment fund. The fund must first pay civil or criminal fines imposed on the institution and, for depository institutions and credit unions, reimburse depositors in full before any Deposit Insurance Fund or National Credit Union Share Insurance Fund amounts are used. Deferred amounts are held for 2, 6, or 8 years depending on whether consolidated assets are $10–50 billion, $50–250 billion, or $250 billion or more (or a regulator-determined period for institutions below $10 billion) and are canceled if insufficient to pay required amounts; ex-employees’ deferred compensation is segregated and protected from later fines for misconduct occurring after their departure.