The Dastardly Bonuses: AIG, Fannie, and Freddieby Brad Warbiany
Those eeevvviiilll capitalists at AIG have been taking quite a beating. Now it’s time to spread the “wealth”:
Fannie Mae plans to pay retention bonuses of at least $1 million to four key executives as part of a plan to keep hundreds of employees from leaving the government-controlled company.
Rival mortgage finance company Freddie Mac is planning similar awards, but has not yet reported on which executives will benefit.
The two companies, which together own or back more than half of the home mortgages in the country, have been hobbled by skyrocketing loan defaults. Fannie recently requested $15 billion in federal aid, while Freddie has sought a total of almost $45 billion.
Fannie Mae disclosed its “broad-based” retention program in a recent regulatory filing with the Securities and Exchange Commission. The company was only required to disclose the amounts for the top-paid executives, who will pocket at least $470,000 on top of their base salaries.
The bonuses are more than double last year’s, which ranged from $200,000 to $260,000. Another round of bonuses ranging from $330,000 to $429,000 are planned for next February.
What’s the over/under on how soon Barney Frank calls for the heads of the top folks at Fannie and Freddie?
Hat Tip: Cafe Hayek