Stopping Bonuses for Unsafe and Unsound Banking Act

Stopping Bonuses for Unsafe and Unsound Banking Act

This bill prohibits large banking institutions from paying discretionary bonuses to senior executive officers while under a supervisory notice issued by a banking regulator. The bill provides exceptions for the time period before a remediation plan is due and while a remediation plan is being implemented.

[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4207 Introduced in House (IH)]

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118th CONGRESS
  1st Session
                                H. R. 4207

To prohibit a large banking institution from paying discretionary bonus 
    payments when the institution is subject to a Matter Requiring 
   Immediate Attention and does not provide the appropriate Federal 
 banking agency with a remediation plan to correct the matter, and for 
                            other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             June 20, 2023

Ms. Pettersen introduced the following bill; which was referred to the 
                    Committee on Financial Services

_______________________________________________________________________

                                 A BILL


 
To prohibit a large banking institution from paying discretionary bonus 
    payments when the institution is subject to a Matter Requiring 
   Immediate Attention and does not provide the appropriate Federal 
 banking agency with a remediation plan to correct the matter, and for 
                            other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Stopping Bonuses for Unsafe and 
Unsound Banking Act''.

SEC. 2. FREEZE ON DISCRETIONARY BONUS PAYMENTS BY LARGE BANKING 
              INSTITUTIONS IN CERTAIN CIRCUMSTANCES.

    (a) In General.--If the appropriate Federal banking agency issues a 
``matter requiring immediate attention'' (or similar supervisory 
notice) to a covered banking institution, the institution may not make 
any discretionary bonus payment to a senior executive officer until the 
matter is resolved to the satisfaction of the appropriate Federal 
banking agency.
    (b) Remediation Plan Exception.--Subsection (a) shall not apply to 
a covered banking institution receiving a ``matter requiring immediate 
attention'' (or similar supervisory notice)--
            (1) during the period beginning on the date the covered 
        banking institution receives the ``matter requiring immediate 
        attention'' (or similar supervisory notice) and ending on the 
        date of the deadline described under paragraph (2) to submit a 
        remediation plan; and
            (2) if the covered banking institution provides the 
        appropriate Federal banking agency with a remediation plan 
        (which shall include an implementation period) to correct the 
        matter that is accepted by the appropriate Federal banking 
        agency by such deadline as determined by the appropriate 
        Federal banking agency, during the period beginning on the date 
        the remediation plan is accepted and the end of the 
        implementation period.
    (c) Definitions.--In this section:
            (1) Covered banking institution.--The term ``covered 
        banking institution'' means--
                    (A) a bank holding company with more than 
                $50,000,000,000 in consolidated assets;
                    (B) a bank subsidiary of a bank holding company 
                described under subparagraph (A); and
                    (C) a bank that does not have a bank holding 
                company and that has more than $50,000,000,000 in 
                consolidated assets.
            (2) Other terms.--The terms ``appropriate Federal banking 
        agency'', ``bank'', ``bank holding company'', and ``Federal 
        banking agency'' have the meanings given those terms, 
        respectively, under section 3 of the Federal Deposit Insurance 
        Act.
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