To All Depository Institutions and Others Concerned in the Second Federal Reserve District:
In a supervisory letter (SR 03-6) dated April 22, 2003, the Federal Reserve Board issued guidance for state member banks and bank holding companies, that are in less than satisfactory condition, regarding certain payments and appointments.
The guidance relates to severance payments (referred to as "golden parachute" payments) and the appointment of new directors or senior executive officers at such troubled institutions. Details are available in the letter.
The Board wants banking organizations subject to the restrictions to be fully aware of them and have monitoring programs in place to ensure compliance with the statutory requirements.
Questions and communications on this matter may be directed at this Bank to Thomas Oravez,Assistant Vice President, Regional/Community Banks.