Banking and Finance Law Daily Wrap Up, BANKING OPERATIONS—FDIC requests comments on renewal of guidance on incentive compensation policies, (Jan 27, 2014)

By Colleen M. Svelnis, J.D

The FDIC has requested comments on the renewal of an existing information collection titled Guidance on Sound Incentive Compensation Policies. The stated purpose of the guidance is to help ensure that incentive compensation policies at insured state nonmember banks and state savings associations do not encourage excessive risk-taking and are consistent with the safety and soundness of the organization. Among other things, the guidance requires banks to have policies and procedures in place to identify risks, establish controls, and maintain the documentation for audits, as well as conduct an annual review of the organizations’ incentive compensation system.

The FDIC requested comments on the following:

• whether the collection of information is necessary for the proper performance of the FDIC’s functions, including whether the information has practical utility;

• the accuracy of the estimates of the burden of the information collection, including the validity of the methodology and assumptions used;

• ways to enhance the quality, utility, and clarity of the information to be collected; and

• ways to minimize the burden of the information collection on respondents, including through the use of automated collection techniques or other forms of information technology.

Comments must be received by 60 days from the date of publication, Jan. 23, 2014.

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