Today at 10 am, Feinberg is going to announce a list of 17 banks that made “ill-advised” payments.
Feinberg intends the list to embarrass the banks that are named on it. But being listed as one of the banks paying out “excessive” compensation might also be a badge of honour.
Most of the payments that banks gave out during the financial crisis (if not all) were given out because they were written into contracts. Banks that upheld those contracts despite popular opinion that they should not demonstrated that they honour agreements with their employees. And it shows that those banks make agreements with their execs to pay them really well.
We already know JPMorgan and Goldman are on the list, and probably all of the usual suspects will be too. It’ll be a shock if any of the big, more desirable banks to work at aren’t on the list.
On the other hand, Feinberg hopes that by listing the 17 banks, he will shame them into adopting a provision to ensure that their execs are never again paid with taxpayer money.
And the list reminds banks, again, that they took taxpayer money. Now that they’ve paid TARP money back, banks want to forget about the financial crisis and move on.
But a comment left yesterday got us thinking that the list might be a badge of honour:
Who exactly is going to feel bad about being on this list? My company is on the list, and it will be a badge of honour for anyone who gets named.
Our take: We call BS on that comment. Getting paid only because there was taxpayer money injected into your firm is not a badge of honour.