Why Banks Don’t Play It Safe, Even When It Costs Them

Better late than never. That’s one way of looking at the proposed new restrictions on banker compensation that U.S. regulators released last week. The rules will require top earners at big financial institutions to wait four years to receive a substantial portion of their incentive-based pay, and will force companies to claw back bonuses from employees whose decisions turn out to be responsible for big losses. The new regulations, which were mandated by the 2010 Dodd-Frank financial-reform bill, were supposed to have been put in place soon after that legislation was passed, but it took five years for the six responsible agencies to put together a reasonable proposal. (And it will be months yet before the individual agencies approve the rules and put them into effect.)

See the rest of the story at newyorker.com

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