WASHINGTON - Federal banking regulators moved yesterday to seek public input on a plan to link the insurance premiums levied on US banks to the degree of risk-taking encouraged by their executive pay policies.
A divided board of the Federal Deposit Insurance Corp. voted to make public a preliminary plan to use executive compensation as a factor in assessing the fees that banks must pay for the deposit insurance fund.
“This is something we cannot ignore,’’ chairwoman Sheila Bair said.
But two heads of Treasury Department agencies, who also sit on the five-member board, voted against floating the proposal.
John Dugan, director of the Office of the Comptroller of the Currency, and John Bowman, acting director of the Office of Thrift Supervision, said it would be premature because Congress and the Federal Reserve are addressing bank compensation.
The FDIC will take public comments for 30 days.
Company policies that encouraged excessive risk-taking and rewarded executives for delivering short-term profits were blamed for fueling the financial crisis. Big banks, especially, were considered to have engaged in such behavior.
“We’re really just asking questions at this point,’’ Bair said. She stressed that the regulators are not seeking to dictate compensation levels for banks but are exploring whether certain pay practices encourage banks to take excessive risks.