In the wake of the financial
crisis, according to the Huffington Post, “a number of the nation's largest
banks were excused from the government's rescue program before they had
returned to a position of complete financial security -- in part because they wanted
to avoid restrictions on how much their executives would get paid, according to
a new report from the program's government overseer. Citigroup, Wells Fargo,
PNC and Bank of America successfully lobbied to leave the federal bailout
program early in 2009, even though the Federal Reserve Board and the Federal
Deposit Insurance Corporation had recommended they take additional steps to
shore up their assets, according to a new report from the Special Inspector
General for the Troubled Relief Asset Program, a government watchdog office.
Regulators, including the Treasury and the Federal Reserve Board, eventually
‘relaxed’ their criteria for letting the banks out of the program, the report
says, leaving questions about whether the banks had strengthened their holdings
enough to be able to withstand another systemic crisis.”[1]
The full essay is at "Executive Compensation: Systemic Risk."
