The objective of the TARP compensation limits has always been to insure that taxpayers receive their money back, said Kenneth Feinberg, special master for the TARP executive compensation committee.
In an interview with CNBC, Feinberg said it was "wonderful" that some companies were repaying TARP. (To hear the full interview, watch the video below.)
If Bank of America and Citigroup are "prepared to repay the taxpayer, that is exactly the objective of the program," Feinberg said.
The pay czar declined to say whether he believed that the companies were ready to exit at this time, saying that was the decision of the Federal Reserve and Treasury.
As for the companies remaining under his oversight, he said he expects that those firms understand the objectives of the compensation limits.
"I've made it clear that General Motors and the other top recipients must under the law remain competitive, and if that means compensation must reflect that competitive dynamic, all to the good," he said.
Going forward, compensation needs to be based on the company's circumstances, Feinberg said.
"I think the notion of limited cash, no guarantees, long-term stock, that's the way to go," Feinberg said.
"Let's give these officials more compensation in the form of stock, which cannot be sold, for three, four, five years and over that term, hope and believe that the official's interests are aligned with the long term strength of the company," he said.