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The Federal Reserve announced Thursday that it intends to begin looking over pay plans at the banks it regulates to ensure they don't encourage undue risk-taking. The Fed can veto pay plans that do. Here are answers to some questions about what Canadian regulators are doing.

What rules are in place now regarding banker pay in Canada?

This summer, the Office of the Superintendent of Financial Institutions told all of banks and insurers that it regulates that they were going to have to comply with the Financial Stability Board's recommendations on compensation, which are designed to ensure bankers don't take big risks seeking big paydays.

Where does that process stand?

OSFI is in the midst of assessing the existing compensation frameworks at some financial institutions, beginning with the larger institutions, said Rod Giles, a spokesman for the reglator.

How will OSFI look at pay?

The regulator plans to begin incorporating compensation into its supervisory practices. That essentially means that OSFI will include compensation on the list of things it takes into consideration as it watches over banks and insurers.

Will OSFI have veto power?

As the industry's regulator, OSFI is able to take action if it sees an institution taking excessive risk.

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