by Paul H. Kupiec
American Enterprise Institute
April 28, 2014
Outside of executive salaries at the largest institutions, perhaps the highest-paying and most-secure jobs in banking can be found at the federal bank regulatory agencies, where average employee compensation is more than 2.7 times that of private-sector bank employees. The easiest-to-fill jobs earn the largest premiums over private-sector salaries. The average compensation at federal bank regulatory agencies is more than 20 percent higher than the compensation at General Schedule federal government agencies. Average salary and bonuses are nearly 20 percent higher, and the banking agencies have additional benefits compensation. The Dodd-Frank Act introduced changes that allow the National Treasury Employees Union to negotiate compensation at nearly all federal banking agencies. Bank shareholders and customers pay the cost of excessive regulator salaries. Shareholders pay directly through higher deposit insurance premiums and bank examination fees, and customers pay indirectly through higher fees, higher loan interest rates, and lower returns on deposits.

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