TEXT OF INTERVIEW
The FDIC is expected to consider a new way to rein in executive pay. Its board is scheduled to vote next week on a proposal that would link salaries to the fees banks have to pay into Federal Deposit insurance fund. Marketplace’s Nancy Marshall Genzer joins us live from Washington. Good morning, Nancy.
Nancy Marshall Genzer: Good morning.
Chiotakis: So how’s it going to work?
Marshall Genzer: Well, banks that base executives’ pay on quick profits that are made from risky behavior would have to pay higher fees. But banks would pay less if they had clawback provisions that allowed them to take back executives’ bonuses if they were based on risky trades where the banks lost money.
Chiotakis: And do economists think this would work and actually curb executive pay?
Marhsall Genzer: Well, I asked William Issac about that, a former chair of the FDIC. He says we don’t need more rules. We need bank regulators to monitor banks more actively.
William Issac: I’d rather have some assessment and debate with the bank about what they’re doing rather than simply have black and white rules that the bank can find a way to avoid.
And the regulators would be assessing things like the quality of the loans and the quality of the bank management.
Chiotakis: All right, Marketplace’s Nancy Marshall Genzer with us live from Washington. Nancy, thanks.
Marshall Genzer: You’re welcome.
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