Big banks repay government bailout funds

Yahoo! Finance ^ | June 17, 2009 | Elinor Comlay and Steve Eder

[Toddsterpatriot]

NEW YORK, June 17 Reuters) - Ten of the largest U.S. banks said on Wednesday they repaid more than $66 billion of taxpayer bailout funds, as they race to extract themselves from government restrictions on pay for top executives.

Banks are returning money taken from the $700 billion Troubled Asset Relief Program, which was once intended to spur lending but is now viewed as a sign that recipients are too weak to survive on their own. In most cases, the banks issued preferred shares that carried 5 percent dividends in exchange for the money.

JPMorgan Chase & Co (JPM - News) said it repaid $25 billion to TARP, while Goldman Sachs Group Inc (GS - News) and Morgan Stanley (MS - News) said they repaid $10 billion each.

Among other banks, U.S. Bancorp (USB - News) said it repaid $6.6 billion, Capital One Financial Corp (COF - News) $3.6 billion, American Express Co (AXP - News) $3.4 billion, BB&T Corp (BBT - News) $3.1 billion, Bank of New York Mellon Corp (BK - News) $3 billion, State Street Corp (STT - News) $2 billion and Northern Trust Corp (NTRS - News) $1.57 billion.

[Toddsterpatriot]

BTW where did the AIG bailout money go?

To meet the liabilities of AIG. Where should it have gone?

[Sarajevo]

Paying back the TARP already? I guess they never needed it in the first place.

In that respect, it was a gift.

[org.whodat]

I'll believe it when I see the canceled checks.

Other than that is was just a swapping of financial paper and no money.

[org.whodat]

At least 22 smaller banks have been allowed to repay some or all of their TARP money, although most must still negotiate terms to buy back or extinguish their associated warrants.

The article in the NEW york Times last week said none of them had the cash on hand to pay any large amount and if they did they would be broke again.

[org.whodat]

As a condition of being allowed to repay, banks had to show they could raise money from the private sector by selling stock and issuing debt without the help of government guarantees.

And on what date did this happen.

[kabar]

I guess the NYT was wrong again.

[org.whodat]

but the rest of the money will be recovered with interest.

La La Land!!!

[org.whodat]

I don’t think so!!!

[kabar]

Much of the AIG bailout money went to foreign banks. Top U.S., European Banks Got $50 Billion in AIG Aid

[Toddsterpatriot]

The article in the NEW york Times last week said none of them had the cash on hand to pay any large amount and if they did they would be broke again.

Link?

[kabar]

Not according to this article. I don’t trust the NYT to report accurately anything. It is staffed by partisans, not journalists.

[Toddsterpatriot]

but the rest of the money will be recovered with interest.

La La Land!!!

Are you sad that banks are paying the money back? Did you predict they wouldn't? LOL!

[Toddsterpatriot]

Much of the AIG bailout money went to foreign banks.

Yeah, like I said...

[org.whodat]

The $68 billion in paybacks would be the largest since the $700 billion Troubled Asset Relief Program took effect eight months ago at the peak of the financial crisis. Specifically, the money comes from a $250 billion slice of the $700 billion bailout package.

Other chunks of the $700 billion will be harder, if not impossible, to recover. Some of it, such as $70 billion funneled to failed insurer American International Group Inc., ended up in the pockets of healthier banks that did deals with AIG

from CBS reports, in short funds given to AIG are used to make this 10% payment!!! Nothing like paying yourself. Print more money!!!

[mono]

..not even 10% recovery yet...

Hey, I am happy we even got a nickel of it back. 60+ bil is not chump change.

[Toddsterpatriot]

Some of it, such as $70 billion funneled to failed insurer American International Group Inc., ended up in the pockets of healthier banks that did deals with AIG

You mean they used it to meet their liabilities? Shocking!

What should they have done with the money?

[neocon1984]

Dude,

The dough ‘aint gone. It’s in the hands of the people. I mean the UAW.

[org.whodat]

But on June 3, the Federal Deposit Insurance Corporation, which was to play a crucial role in the plan by guaranteeing loans to investors, said it was putting one part of the plan on hold indefinitely, as banks were refusing to sell their troubled assets for the prices they were likely to get under the program. At the same time, some banks that had passed the Federal Reserve's "stress test'' were raising funds on their own to use to pay back money they had gotten from the Treasury.

Some observers called the banks' refusal to sell the so-called legacy assets and the move to repay the government as signs that the worst of the crisis had passed; others countered that any signs of bank profitability rested more on accounting changes than changed business conditions, and that hundreds of billions in new losses lay ahead. The other big part of the Geithner plan, aimed at troubled mortgage-backed securities, was still being prepared, officials said.

http://finance.yahoo.com/news/Big-banks-repay-government-rb-15553312.html?.v=7

[Toddsterpatriot]

Some observers called the banks' refusal to sell the so-called legacy assets and the move to repay the government as signs that the worst of the crisis had passed; others countered that any signs of bank profitability rested more on accounting changes than changed business conditions,

You mean that bonds which were marked down (but not actually sold) are now being marked back up? That's a shocker, I thought they only marked bonds down.

[1rudeboy]

I just knew there is more to this story. When even Fleck(enstein) praises Paulson's "fancy footwork," you have to figure that some chips fell where they should.

So, what's the deal? Are we confusing the govenment's initial reaction with what followed?