Banks need power to rewrite pay package in crisis: pay czar

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Banks need power to rewrite pay package in crisis: pay czar

Market Watch – WASHINGTON (MarketWatch) — The boards of major financial firms need the power to cancel or reduce bonuses to top executives when the firms find themselves in another crisis, according to a report released Friday by Kenneth Feinberg, the Obama administration's special master on compensation.

Under his plan, the compensation committees of the boards would have a "break provision" to restructure bonus payment to fit the new circumstances. Read summary of special master's report.

During the recent financial crisis, Feinberg said 17 bailed-out banks paid their executives $1.6 billion in various bonuses while the banks were receiving taxpayer funds.

Among the firms that gave bonuses were Goldman Sachs Group Inc (GS 146.10, -1.28, -0.87%) , J.P. Morgan Chase & Co. (JPM 39.94, +0.11, +0.28%) and Citigroup Inc. (C 4.09, +0.07, +1.62%)

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