Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. PROHIBITION ON CERTAIN COMPENSATION. 
(a) PROHIBITION ON CERTAIN COMPENSATION NOT 
BASED ON PERFORMANCE STANDARDS.—Section 111 of the 
Emergency Economic Stabilization Act of 2008 (12 U.S.C. 
5221) is amended by redesignating subsections (e) through 
(h) as subsections (f) through (i), and inserting after sub-
section (d) the following: 
‘‘(e) PROHIBITION ON CERTAIN COMPENSATION NOT 
BASED ON PERFORMANCE STANDARDS.— 
‘‘(1) PROHIBITION.—No financial institution 
that has received or receives a direct capital invest-
ment under the Troubled Assets Relief Program under 
this title, or with respect to the Federal National 
Mortgage Association, the Federal Home Loan Mort-
gage Corporation, or a Federal home loan bank, 
under the amendments made by section 1117 of the 
Housing and Economic Recovery Act of 2008, may, 
while that capital investment remains outstanding, 
make a compensation payment, other than a lon-
gevity bonus or a payment in the form of restricted 
stock, to any executive or employee under any exist-
ing compensation arrangement, or enter into a new 
compensation payment arrangement, if such com-
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pensation payment or compensation payment ar-
rangement— 
‘‘(A) provides for compensation that is un-
reasonable or excessive, as defined in standards 
established by the Secretary, in consultation with 
the Chairperson of the Congressional Oversight 
Panel established under section 125, in accord-
ance with paragraph (2); or 
‘‘(B) includes any bonus or other supple-
mental payment that is not directly based on 
performance-based measures set forth in stand-
ards established by the Secretary in accordance 
with paragraph (2). 
Provided that, nothing in this paragraph applies to 
an institution that did business with a recipient of a 
direct capital investment under the TARP. 
‘‘(2) STANDARDS.—Not later than 30 days after 
the date of enactment of this subsection, the Secretary, 
with the approval of the agencies that are members of 
the Federal Financial Institutions Examination 
Council, and in consultation with the Chairperson of 
the Congressional Oversight Panel established under 
section 125, shall establish the following: 
‘‘(A) UNREASONABLE AND EXCESSIVE COM-
PENSATION STANDARDS.—Standards that define 
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‘unreasonable or excessive’ for purposes of sub-
paragraph (1)(A). 
‘‘(B) PERFORMANCE-BASED
STANDARDS.— 
Standards for performance-based measures that 
a financial institution must apply when deter-
mining whether it may provide a bonus or reten-
tion payment under paragraph (1)(B). Such 
performance measures shall include— 
‘‘(i) the stability of the financial insti-
tution and its ability to repay or begin re-
paying the United States for any capital 
investment received under this title; 
‘‘(ii) the performance of the individual 
executive or employee to whom the payment 
relates; 
‘‘(iii) adherence by executives and em-
ployees to appropriate risk management re-
quirements; and 
‘‘(iv) other standards which provide 
greater accountability to shareholders and 
taxpayers. 
‘‘(3) REPORTING REQUIREMENT.— 
‘‘(A) IN GENERAL.—Any financial institu-
tion that is subject to the requirements of para-
graph (1) shall, not later than 90 days after the 
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date of enactment of this subsection and annu-
ally on March 31 each year thereafter, transmit 
to the Secretary, who shall make a report which 
states how many persons (officers, directors, and 
employees) received or will receive total com-
pensation in that fiscal year in each of the fol-
lowing amounts: 
‘‘(i) over $500,000; 
‘‘(ii) over $1,000,000; 
‘‘(iii) over $2,000,000; 
‘‘(iv) over $3,000,000; and 
‘‘(v) over $5,000,000. 
The report shall distinguish amounts the institu-
tion considers to be a bonus and the reason for 
such distinction. The name or identity of persons 
receiving compensation in such amounts shall 
not be required in such reports. The Secretary 
shall make such reports available on the Internet. 
Any financial institution subject to this para-
graph shall issue a retrospective annual report 
for 2008 and both a prospective and retrospective 
annual report for each subsequent calendar year 
until such institution ceases to be subject to this 
paragraph. 
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‘‘(B) TOTAL COMPENSATION DEFINED.—For 
purposes of this paragraph, the term ‘total com-
pensation’ includes all cash payments (including 
without limitation salary, bonus, retention pay-
ments), all transfers of property, stock options, 
sales of stock, and all contributions by the com-
pany (or its affiliates) for that person’s benefit.’’. 
(b) REVISION TO RULE OF CONSTRUCTION.—Section 
111(b)(3)(D)(iii) of the Emergency Economic Stabilization 
Act of 2008 (12 U.S.C. 5221(b)(3)(D)(iii)) is amended by 
inserting before the period the following: ‘‘, except that an 
entity subject to subsection (e) may not, while a capital in-
vestment described in that subsection remains outstanding, 
pay a bonus or other supplemental payment that is other-
wise prohibited by clause (i) without regard to when the 
arrangement to pay such a bonus was entered into’’. 
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