The problem with performance bonds is that it assumes that key people involved in these decisions have substantial tenure with a bank. This is not a reasonable assumption. Statistical risk modelers at large banks have tenure of only a few years at best, so the model may well fail after they are gone. Many of these risk modelers may not even be working in the United States when the models fail. Indeed the top people have higher turnover. Management does not want to create a culture where they would pay a premium to keep statistical modelers for substantial periods of time. This needs to change.