As readers of this blog know, I have be an advocate of credit union transparency with regard to the pay of senior executives.
State chartered credit unions disclose the compensation of their senior management in their Form 990 filings with the Internal Revenue Service.
On the other hand, federal credit unions are not required to file Form 990s. As a result, credit union members and taxpayers do not have the ability to evaluate the pay of senior management and to determine if this valuable tax exemption that credit unions receive is being diverted into excessive compensation of senior federal credit union officials.
However, I was very pleased to see that Pentagon Federal Credit Union is disclosing the pay of senior management.
In Note 15 of its 2013 Annual Report, Pentagon Federal Credit Union discloses the compensation package of its CEO and 8 other senior executives.
Also, Note 15 discusses how the credit union sets the pay for senior management at the credit union.
The only criticism is that Pentagon Federal Credit Union could have provided more granularity with regard to pay by separating salary (or base pay) from bonus.
Other federal credit unions should follow Pentagon Federal Credit Union's example and disclose the compensation of their senior management.
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Where is that info on the ABA Chairman? His privately-held bank does not disclose his pay.
ReplyDeleteIf you want to give up your tax-exemption and be a privately held bank, you can play by the same rules.
ReplyDeleteSo Keith, if we're understanding your position, you're saying credit union transparency is more important than bank transparency. And that would mean that you are saying you aren't particularly interested in customers being provided executive compensation information so they can fully evaluate the (theoretical) value provided by their bank.
ReplyDeleteThis begs the question: where does the well-being of the consumer rank on the ABA's list of priorities?
We know the top 2 spots are made up of Profit Maximization and Competition Minimization.
Does the consumer squeak into the top 5?
(I know, I know. Tax "subsidy", Yada Yada.)
If a bank is publicly traded, there is disclosure of executive compensation.
ReplyDeletePrivately-held - especially federally corporate tax exempt Sub S Bank - all that info is kept quiet from employees, customers and trade association leaders.
Delete