Six years after Congress mandated it, the Federal Deposit Insurance Corp. today will limit golden parachutes for executives at troubled banks and thrifts.

With the record-setting earnings of recent years, the rule will affect just a handful of struggling institutions.

"As of today, there are a minuscule number of banks that the reg will apply to," said Robert Miailovich, the FDIC's associate director of supervision policy. "But because the law is out there, we continue to get a rather constant stream of questions from the industry about writing employment contracts."

Congress passed the Bank Fraud Act in 1990 to prevent huge payouts to people responsible for the failure of banks or thrifts. The FDIC first tried to enforce the law in October 1991, but industry complaints that the proposed rule was too harsh sent the agency's staff back to the drawing board.

Then two unrelated events sidelined the regulation's progress: President Bush's moratorium on new rules and passage of the FDIC Improvement Act, which kept the agency busy on other priorities.

Finally, last March, the FDIC resurrected the regulation in a much gentler form. In an interview Monday, Mr. Miailovich said the final rule to be voted on today by the FDIC board would be "substantially unchanged" from the version released in March.

However, it is possible that the FDIC will bend to industry demands that already adopted golden parachutes be grandfathered in.

The rule limits severance packages for managers at ailing banks and thrifts to one year's pay. Some executives will be excused from the golden parachute restrictions - among them "white knights" who join troubled institutions. In another compromise with the industry, the FDIC is expected to exclude bona fide deferred compensation plans, even if they are not funded, from the golden parachute restriction.

The FDIC also was expected to spell out today when a bank or thrift may foot the bill for an employee fighting a regulatory enforcement action.

This indemnification rule, also eased since first proposed in 1991, applies to all institutions. A bank's board of directors will have to determine that an employee acted in good faith and in the institution's best interests before indemnifying him or her.

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