After having his potential $3 million raise emphatically swatted out to half court by the House of Representatives on Monday evening, one might think that Freddie Mac CEO Donald Layton would be a little upset.
But, in an interview with the Wall Street Journal, Layton said that he views the job as a “public service matter” and said the compensation wasn’t the “big attraction” to the job for him.
“I regard this as something that is happening inside the government,” Layton said in a video interview with the WSJ’s Shelby Holiday.
“I signed up for this job personally as a public service matter so the compensation wasn’t the big attraction to me and so I really just don’t regard it as a big issue personally,” Layton continued.
Asked what the pay cap, which, once signed into law by President Obama, would limit the salaries of the Freddie Mac and Fannie Mae CEOs to $600,000, would do to a succession plan for the next Freddie Mac CEO, Layton said it would present some challenges.
“Yeah, I have to make it clear that while the CEO compensation symbolically is capped, we are able to pay reasonably to attract talent in the rest of the company so my subordinates usually make more money than I do,” Layton said.
“In terms of my board, they are concerned about this making succession harder,” Layton continued. “But many things are hard in life, so they’ll take a longer time to do it. But I am of the belief that there are other people like me who have good careers, who are knowledgeable at financial services, and would be willing to do a job as a public service matter.”
Asked if there might be difficulty attracting a replacement whenever that time comes, Layton said that the CEO pay is “considerably more” than government officials and “there are many people who are willing to go to Washington to be a government appointee.”
Holiday asked Layton his view on whether Freddie Mac is a private business still or a government entity at this point.
To which Layton responded:
“It is undeniable we represent a hybrid. Being CEO of Freddie Mac is not the same as being CEO of a full normal commercial company. It has a public service aspect. The government ownership means there’s a lot of policy issues substituting for what would otherwise be traditional stockholder issues.”
See the full interview below or click here to watch it.