Fannie Mae CEO Timothy Mayopoulos and Freddie Mac CEO Donald Layton will each earn annual base salaries of $750,000, with a $2.1 million fixed deferred compensation and $1.2 million in at-risk deferred salary.
That will equate to $4 million per year for both, a substantial increase from salaries that were capped at $600,000 per year for the past few years.
According to the Federal Housing Finance Agency, the deferred compensation components are meant to entice both to stick with their respective companies.
FHFA director, Mel Watt said the pay hikes were done to “promote CEO retention, allow reliable succession planning and ensure the continuity, efficiency and stability of Enterprise operations,” according to the Wall Street Journal.
However, the decision to increase their salaries is already drawing criticism.
"As long as American taxpayers continue to serve as the backstop for Fannie and Freddie, FHFA should make decisions that protect taxpayers instead of ones that expose them to further risk," Senator Richard Shelby of Alabama who heads the Senate Banking Committee said in a statement, according to the Associated Press.
According to the Wall Street Journal, the U.S. Treasury Department is also critical of the move.
“(It) does not support FHFA’s new approach to CEO compensation at Fannie Mae and Freddie Mac and urged the agency to reject any increase,” a spokesperson told the Journal.
Fannie and Freddie CEOs are set to enjoy massive paydays, after years of having their salaries capped following the economic crisis.