Page:United States Statutes at Large Volume 105 Part 3.djvu/384

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105 STAT. 2268 PUBLIC LAW 102-242 —DEC. 19, 1991 "(b) ASSET QUALITY, EARNINGS, AND STOCK VALUATION STAND- ARDS. —Each appropriate Federal banking agency shall, for all insured depository institutions and depository institution holding companies, prescribe— "(1) standards specifying— "(A) a maximum ratio of classified assets to capital; "(B) minimum earnings sufficient to absorb losses without impairing capital; and "(C) to the extent feasible, a minimum ratio of market value to book value for publicly traded shares of the institution or company; and "(2) such other standards relating to asset quality, earnings, and valuation as the agency determines to be appropriate. "(c) COMPENSATION STANDARDS. —Each appropriate Federal banking agency shall, for all insured depository institutions, prescribe— "(1) standards prohibiting as an unsafe and unsound practice any employment contract, compensation or benefit agreement, fee arrangement, perquisite, stock option plan, postemployment benefit, or other compensatory arrangement that— "(A) would provide any executive officer, employee, director, or principal shareholder of the institution with excessive compensation, fees or benefits; or "(B) could lead to material financial loss to the institution; "(2) standards specifying when compensation, fees, or benefits . referred to in paragraph (1) are excessive, which shall require the agency to determine whether the amounts are unreasonable or disproportionate to the services actually performed by the individual by considering— "(A) the combined value of all cash and noncash benefits provided to the individual; "(B) the compensation history of the individual and other individuals with comparable expertise at the institution; "(C) the financial condition of the institution; "(D) comparable compensation practices at comparable institutions, based upon such factors as asset size, geographic location, and the complexity of the loan portfolio or other assets; "(E) for postemployment benefits, the projected total cost and benefit to the institution; "(F) any connection between the individual and any fraudulent act or omission, breach of trust or fiduciary duty, or insider abuse with regard to the institution; and "(G) other factors that the agency determines to be relevant; and "(3) such other standards relating to compensation, fees, and benefits as the agency determines to be appropriate. "(d) STANDARDS TO BE PRESCRIBED BY REGULATION. —Standards under subsections (a), (b), and (c) shall be prescribed by regulation. "(e) FAILURE TO MEET STANDARDS. — "(1) PLAN REQUIRED. — "(A) IN GENERAL. — If the appropriate Federal banking agency determines that an insured depository institution or depository institution holding company fails to meet any standard prescribed under subsection (a), (b), or (c) the agency shall require the institution or company to submit