The Federal Deposit Insurance Corp. issued its proposed rule, required by the Dodd-Frank Act, last month that would set longer time horizons on incentive-based compensation and require a review of compensation practices for employees who expose financial firms to substantial risk. The rule aims to prevent "excessive compensation" at covered institutions, including banks, bank holding companies, broker-dealers, credit unions, investment advisers, Fannie Mae, and Freddie Mac.

Ballard Spahr partner Mary Mullany worries about the downside of the rule, which would require the entities to defer at least half of the incentive-based compensation going to their top executives for at least three years. "You want some certainty if you are an executive officer that if you're getting an incentive award and you perform in compliance with the performance goals that are set, that you'll actually get paid the reward," Ms. Mullany said.