Bipartisan bill would empower FDIC to pursue failed bank exec clawbacks

A bipartisan bill seeks to require the Federal Deposit Insurance Corporation (FDIC) to claw back five years’ worth of compensation from executives who lead failed banks.

The Failed Bank Executives Clawback Act, introduced Wednesday by Sens. Elizabeth Warren (D-Mass.), Josh Hawley (R-Mo.), Catherine Cortez Masto (D-Nev.), and Mike Braun (R-Ind.), also proposed to extend clawback authorities established by the Dodd-Frank Act to apply to any bank that enters into FDIC receivership—not just banks that are liquidated.

Should a bank fail, investors in the bank’s holding company should bear the losses, the bill said.