WASHINGTON — The details are still sketchy, but an idea to tie compensation plans to deposit insurance premiums is already dividing the banking industry.

The Federal Deposit Insurance Corp. plans to issue a proposal Tuesday that would add specific types of compensation programs to the list of risk factors that determine a bank's assessment rate, according to sources.

Though the plan is not expected to be made public until Tuesday's FDIC board meeting, it has already sparked debate among industry representatives. Some say the plan has merit and would even benefit some institutions, but others fear it would intrude into management decisions and conflict with other regulations.

"If the FDIC proposes linking employee compensation to a bank's FDIC premium assessment, they are opening a Pandora's Box of troubles," said Camden Fine, the president and chief executive officer of the Independent Community Bankers of America. "If what has been reported is accurate, the FDIC is headed down the path of dictating to banks what their compensation practices should be. And they will use FDIC premium payments as a weapon to enforce salary practices in banks."

Word of the proposal surfaced Wednesday after the FDIC posted its agenda for Tuesday's meeting. The agency said it would consider an advance notice of proposed rulemaking dealing with "employee compensation" at the meeting but gave no details.

Sources said the board action would be intended to get industry feedback on including certain types of compensation plans — which can either increase or decrease a company's risk — in the formula for determining an institution's deposit insurance premium.

The agency will not suggest how much bankers should be paid, the sources said, but rather lay out how certain types of pay plans could be a factor in determining how much each institution should be assessed. For example, plans that encourage short-term risk-taking could potentially drive up a premium, but a plan to let the bank "claw back" compensation could reduce the fee.

"The intention is to target compensation structures, not set limits or caps" on pay, said a source familiar with the situation.

The plan would be yet another move by the government to rein in the sorts of pay practices that encouraged risky lending and fueled the housing crisis. It would also create a new front for FDIC Chairman Sheila Bair, who has been at the fore in policymaking on everything from loan modifications to toxic assets to regulatory reform.

Industry representatives immediately questioned connecting compensation to the other assessment factors, which are meant to reflect the risk an institution poses to the FDIC's reserves.

"I'm very concerned that it's a slippery slope of using deposit insurance to micromanage the bank," said James Chessen, the American Bankers Association's chief economist. "They would have to demonstrate convincingly that" compensation "does pose a risk of loss to the" Deposit Insurance Fund. "I'm just not convinced that argument could be made."

Yet some bankers were less concerned.

Dan Rollins, the president of the $9 billion-asset Prosperity Bancshares Inc. in Houston, said he has no problem with adding compensation to the list of factors affecting an institution's premium.

"We run a fairly conservative, middle-of-the-fairway organization," he said. "We don't take risk and don't do things other banks are doing, and we think we should pay a lower rate because of that."

Rollins said pay structures exist that do lead to riskier business models, such as programs that reward lenders based on how many loans they book.

"If you are paying for production, it has a tendency to produce problems," he said. "Our incentive plan does not pay for production in any way."

Though community bankers speculated that the move may hurt larger banks more than smaller ones, this did not mean they supported the change.

"It is pretty clear that this is an initiative directed at the largest banks," said Arthur C. Johnson, the chief executive of the $425 million-asset United Bank of Michigan and the ABA's chairman. "But those policy changes always have a way of filtering down to us over time. That is always a fear to me."

Michael D. Cahill, the president and chief executive of the $700 million-asset Tower Financial Corp. in Fort Wayne, Ind., said compensation is already a part of the risk assessment because it shows up in a factor measuring a bank's expenses and efficiency.

"It is a complete reach for no real gain," he said. "This is just an around-the-horn reaction to payment practices at the 19 largest banks. It isn't going to impact us, but it might waste my time and my board's time."

Since Congress gave the FDIC substantial leeway to set premiums in 2006, the agency has used a complicated risk-based system to determine how much an institution should pay. Key factors include an institution's Camels ratings, financial performance and use of wholesale funding.

Some observers said executive compensation should also be considered.

"In principle, compensation plans could predict risk-taking behavior," said George Pennacchi, a finance professor at the University of Illinois at Urbana-Champaign, "and in that sense, if it's the type of compensation plan where there would be incentives to take a lot of risk, … then that would be a risk factor that one could take into account for pricing deposit insurance."

But other observers said the FDIC may be moving too aggressively. Executive compensation has been addressed by other agencies, they noted, including the Federal Reserve Board, which proposed guidance in October designed to ensure prudent practices at bank holding companies.

"The FDIC's taking this issue up now is more a reflection of the perils of an uncoordinated federal regulatory system than of one agency getting ahead of the wave," said Cornelius Hurley, a former counsel to the Fed and the director of the Morin Center for Banking and Financial Law at Boston University.

Bert Ely, an independent consultant based in Virginia, said the agency should focus on risk factors other than compensation.

"There is no reasonably analytical way to link executive compensation to deposit-insurance premiums, in part because such a premium assessment would have to be forward-looking," Ely said. "The FDIC has never even attempted to link deposit-insurance premiums to leading indicators of banking risk, such as rapid asset growth or especially risky lending."

But John Bovenzi, the FDIC's former chief operating officer, said that, though a link between compensation and deposit insurance pricing is "debatable," pay structures do have the potential to indicate bank risk.

"If the idea is to have appropriate compensation that gives the right long-term incentives as opposed to short-term thinking, conceptually it is addressing something before a problem emerges," said Bovenzi, now a partner at Marsh & McLennan Cos.' Oliver Wyman.

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