NU Online News Service, March30, 4:18 p.m.EDT

Federal financial regulators are taking aim at largecompensation packages paid to non-executives at financialinstitutions.

In a regulation proposed Wednesday, federal financial servicesregulators would bar incentive-based compensation that areexcessive or that "could expose the institution to inappropriaterisks that could lead to material financial loss."

The rule requires disclosure of incentive-based compensationarrangements for top executives.

It also establishes special rules for institutions with assetsof more than $50 billion, and requires the boards, or committees ofboards of large financial institutions, to monitor and oversee suchcompensation. Additionally, it requires deferral of parts of largecompensation packages.

The rule was mandated by the Dodd-Frank financial serviceslaw.

The provision would require boards of institutions with assetsof more than $50 billion to identify those persons other than topexecutives, that have the ability to expose the institution topossible losses "that are substantial in relation to theinstitution's size, capital, or overall risk tolerance."

The proposal would require that an institution's board ofdirectors, or a committee of directors, of the institution approvethe incentive-based compensation arrangement for non-topexecutives, and maintain documentation of such approval.