FDIC and Compensation Fines for Private Companies

Matt Yglesias blogged yesterday that he thought it was a good idea for the Federal Deposit Insurance Corporation to adopt a policy of fining financial services companies that adopt compensation practices that encourage risky, short-term profit seeking. I can understand why that principle is appealing. But I would be extremely curious to hear more about how the FDIC defines those compensation practices, and on what basis they've concluded they're risky. If there's one thing that's become clear to me in the course of covering government, it's that folks don't have a great idea of how compensation works for anybody, and what kinds of pay motivates what kinds of behavior. Some types of pay, like stock options, may be exceptionally risky, and acknowledged to be so. But I'd want to know what else they were going to target before declaring this a fantastic idea across the board.