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| February 18, 2010 |
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| Executive Compensation and Risk: TARP Rules for Financial Institutions Trigger Broader Risk Assessment of Compensation Policies |
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Michael S. Melbinger
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Posted with the permission of the North Carolina Banking Institute journal, published at the University of North Carolina School of Law, http://studentorgs.law.unc.edu/ncbank/default.aspx.
The world of executive compensation will never be the same for financial institutions after 2009. In fact, due to the crisis in the world’s financial markets in 2009, the world of executive compensation most likely will never be the same for any publicly
traded corporation. Looking for a scapegoat for the near collapse
in the world’s financial markets, many in the government and
media (both in the U.S. and Europe), sought to blame the compensation policies of financial institutions. Therefore, limitations and restrictions on executive compensation became a
central part of the legislation proposed and adopted in response to
the financial crisis.
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