http://apnews.myway.com/article/20090725/D99LM2A80.html
"Companies will need to convince Mr. Feinberg that they have struck the right balance to discourage excessive risk taking and reward performance for their top executives," a Treasury spokesman said Saturday. "That process is just beginning now, and Mr. Feinberg has begun consulting with those firms about their compensation plans. We are not going to provide a running commentary on that process, but it's clear that Mr. Feinberg has broad authority to make sure that compensation at those firms strikes an appropriate balance."
Some of the banks that received government loans, including JPMorgan Chase & Co. and Goldman Sachs Group Inc., already have paid back their debt, and are no longer subject to compensation oversight. Those firms are able to offer lucrative deals to entice employees away from other banks.
That leaves banks like Citigroup scrambling to retain the talent they need to turnaround their operations. Among the hardest hit by the credit crisis and recession, Citi has reported six straight quarterly losses totaling nearly $30 billion. The bank, which will soon be 34 percent-owned by the government, has reduced staff and sold assets to streamline operations and return to profitability.
To keep vital personnel from decamping to other firms, Citi in April asked the Treasury to free the highly profitable Phibro unit from federal compensation limits and last month said it would boost the base salaries of many employees - reportedly by as much as 50 percent for some workers - as it restructures their compensation amid government restrictions on bonuses.
"Retaining and attracting the best talent is very important to the success of Citi and all its stakeholders," Citigroup spokeswoman Danielle Romero-Apsilos said in a statement Saturday, while declining specific comment on Hall's contract. "Citi continues to examine ways to ensure its employee compensation practices are competitive in this very challenging market environment."
The Treasury spokesman noted that Feinberg's task is to ensure that companies "strike the right balance around their need to retain talent, reward performance, and protect the taxpayers' investment."
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