On March 23, I published that David Maus, the President and CEO of Public Service Credit Union, had a total compensation package of $11 million for 2010.
This information is available, because state chartered credit unions are required to file Form 990s with the Internal Revenue Service.
However, federal credit unions are exempt from filing Form 990s. So, unless the federal credit union on its own discloses executive compensation, the members are in the dark regarding executive compensation.
In 2008, NCUA's Outreach Task Force in 2008 concluded that since federal credit unions are cooperatives, the NCUA Board should adopt an amendment to its regulations requiring federal credit unions to annually disclose the total compensation of each senior executive officer to their membership; but the Outreach Task Force recommended that the public is not entitled to individual senior executive compensation information.
The NCUA Board has put in place these disclosure requirements for corporate credit unions; however, the NCUA Board has not done so for federal credit unions.
More than 4 years have passed since the NCUA Outreach Task Force published its recommendation. The NCUA Board should move forward in proposing a rule requiring federal credit unions to annually disclose the compensation of senior executives.
Moreover, any proposal should make this information available not only to the members, but to the public.
This would ensure comparable treatment with other tax-exempt entities, especially state chartered credit unions.
It would also help ensure that federal credit unions are fulfilling their public policy objectives.
Without transparency, there is not accountability.
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Oh dere! Does that mean we would have disclose our filthy stinking rich SERP (Senior Executive Retirement Plan) too? Like the $6M SERP awarded to WesCorp CEO Bob Siravo? Or are you speaking about the cool $2.1M paid to CEO Grace Mayo prior to the 3-23-2012 Conservatorship of Telesis CU? Are you suggesting the credit union disclose to its membership other such perks like the BOLI (Bankers Owned Life Insurance) structures for credit union CEO's and the fancy Bob Siravo country club golf memberships? If you get what you pay for it looks like some credit unions are due a huge refund!
ReplyDeleteAs long as ALL banks have to provide the same disclosure including those privately held or held as non-corporate taxpaying Subchapter S institutions then I would have no problem. Otherwise, I would object to more disclosure on credit union salaries than on bank salaries.
ReplyDeleteKeith,
ReplyDeleteNo doubt there are abuses of the system and unfair results when comparing compensation and performance in a few credit unions. But, if the supposed abuses commented on in your blog are the only or worst offences you can find, lighten up. I don't think bankers on main street or wall street want to see their compensation and performance put side by side with credit unions. As you probably know, because of how the IRS treats credit union deferred comp plans, a sizable lump sum must be accrued and paid out when vesting of the retirement benefit occurs. Therefore, many CEOs wind up with very high annual compensation numbers for the year they become eligible to retire. Those dollars were earned over many years and you guys seem to like portraying the payouts as over compensation. As an industry, credit unions represent a much better value for their member owners than banks.