Monday, February 24, 2014

SEC rejects request for BofA, Wells to make risk disclosures

A regulator has rejected shareholder proposals from New York's comptroller that sought to make Bank of America and Wells Fargo disclose which employees could expose them to major losses because of their bonus incentives, according to documents filed with the Securities and Exchange Commission.

The comptroller, Thomas DiNapoli, sought to include the resolutions in the banks' proxy statements.

DiNapoli is trustee of New York's $173 billion pension fund, which has $1.2 billion in investments in the banks, according to a story on the Boston Herald's website. DiNapoli has said he is concerned about a "high risk, high rewards" approach to investing without fully assessing possible downsides.

"Unless banks shed more daylight on their incentive-based pay practices, shareholders will continue to face unnecessary risks," he said Monday. "The SEC should reconsider its decision and review the facts of our request."

The Securities and Exchange Commission rejected the proposals, which would have asked the banks' boards to identify employees who could expose them "to possible material losses."