March 6, 2009 / 10:00 AM / in 9 years

Canada regulator plans oversight of bank pay: report

(Reuters) - Canada’s banking regulator plans to scrutinize bankers’ pay packages in an effort to prevent the excessive risk taking they might make in search of big bonuses, the Globe and Mail website said on Friday.

The Office of the Superintendent of Financial Institutions (OSFI) plans to scrutinize compensation packages at different levels in the bank and seek changes if it finds any pay systems that promote too much risk taking without curbs, the national newspaper said.

“We’re not interested in levels so much as we’re really focused on the risks,” OSFI superintendent Julie Dickson said in an interview with the Globe this week. “What kind of incentives do these compensation schemes create?”

The Financial Stability Forum, an international group of finance and regulatory official to which Dickson belongs, will make similar comments in its recommendations issued before the Group of 20 meets on April 2 in London, the paper said.

“The big issue here is that, if you look around globally, not many financial institutions designed their compensation schemes with risk in mind,” Dickson said.

Reporting by Ratul Ray Chaudhuri in Bangalore; editing by Karen Foster

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