Pay czar to pull back curtain on banker pay

By David Ellis, staff writer


NEW YORK (CNNMoney.com) -- White House pay czar Kenneth Feinberg is expected to issue a report on Friday that will lay bare what Wall Street executives were paid during the height of the financial crisis.

Feinberg will publish his review of pay practices for top executives at 419 companies that took taxpayer funds under the Troubled Asset Relief Program between October 2008 and February 2009, the Treasury Department said Thursday.

The announcement will represent one of Feinberg's most sweeping efforts since he was appointed by President Obama as special master last summer. It is also very likely his last as he becomes fully immersed in paying claims related to the BP (BP) oil spill.

His latest report on banker pay, announced in March, sought information about each company's most senior executives and the next 20 most highly-paid employees.

Much of Friday's announcement is expected to focus on executives that earned more than $500,000. As a result, hundreds of community and regional banks that also took TARP funds were likely spared of any scrutiny by Washington's pay czar.

The report will also represent the latest in a series of rulings by Feinberg.

Last October, Feinberg slashed pay for top executives at the seven companies that were rescued more than once by the federal government -- AIG (AIG, Fortune 500), Citigroup (C, Fortune 500), Bank of America (BAC, Fortune 500), General Motors, GMAC, Chrysler and Chrysler Financial.

He quickly followed that up just two short months later by capping salaries for lower-level executives at those same firms at $500,000. Both rulings served as benchmark for employee pay levels in 2010.

The issue of compensation has remained a subject of intense interest, both in Washington and on Main Street, particularly as unemployment levels remain stubbornly high and as foreclosures continue at a rapid clip.

So far however, pay levels, particularly among Wall Street firms, appear to be recovering as many financial companies have returned to profitability.

Last year, bonuses paid to Wall Street workers rose by 17% to an estimated $20.3 billion, according to New York State's Deputy Comptroller.

Many leading compensation experts anticipate bonuses at securities firms will continue their ascent in 2010, but will likely remain below the record levels seen just before the crisis struck.

Early indications suggest that Wall Street firms are at least moving cautiously for fear of inciting another public backlash over pay.

Earlier this week, Goldman Sachs (GS, Fortune 500) said its bonus pool shrank by 18% from a year ago as it set aside $9.3 billion to pay salaries, benefits and year-end bonuses.  To top of page

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