BankThink

This week hasn´t been pretty for Sen. Chris Dodd. Our business isn´t to take sides, but it´s worth noting: It wasn´t too long ago that bankers and politicians were mostly relieved that his executive compensation provision did not apply retroactively.

Editor's note: the following letter to the editor was written in response to the story titled "CU Aversion To Government Bailout Dissipates" related to the corporate stabilization plan (CU Journal, March 13).

In talking with CEOs and board members it has been surprising to find that a significant number are not comfortable that the CEO incentive plan they have is either effective or appropriate. This is worrisome because it can contribute to poor performance and dissatisfaction by both board members and CEOs. Let me point out several features that an incentive plan should have that will effectively motivate the CEO.

The question of research in-house vs. outsourced implies an either-or answer. In truth, and with the "Five Ps" as a guide, this is more than an all-or-nothing question. The Five P's are a process for effective research results — Purpose (why), Plan (how), Performance (implementation), Processing (analysis), and Presentation (reporting) — and can be helpful in determining in-house vs. outsourcing of research, in part or whole.

Have you ever had a member sit across the desk from you because they're finances are a bloody mess thanks to self-inflicted wounds? What you really want to do is reach across the desk and slap them upside the head. How could they not see all this coming?

Editor's note: the following letter to the editor was written in response to news of a bill to impose the Community Reinvestment Act on CUs (CU Journal Daily, March 11) and a story on NCUA being sued over the Norlarco participations (CU Journal Daily, March 10)

As the regulatory restructuring debate heats up, two financial consultants are proposing a plan for defining and controlling systemic risk that serves as yet another example of how to make use of laws, rather than agencies, to temper the growth of large financial institutions.

Bankers and small business owners clashed during a Senate hearing on small business lending on Thursday, as the entrepreneurs complained of scarce credit while bankers insisted they had not cut back on lending.

The final day of SourceMedia´s Best Practices in Retail Financial Services Symposium came down hard on the lifeblood of banking in the new era: deposits. Fittingly, the weather metaphors that have been the go-to descriptor of all that´s gone wrong continued. "The deposit business is more important than ever but there will continue to be some real headwinds," says Sherief Meleis, managing director at Novantas.

Looking for a systemic risk regulator that isn´t limited by inevitable human folly? Several options that bypass growing concerns over the potential effectiveness of the Federal Reserve Board´s systemic risk oversight are floating around Washington. They involve strengthening laws, not agencies.