Financial Regulatory Forum

White House mulls bank fee in budget -reports

WASHINGTON, Jan 11 (Reuters) – The Obama administration is considering imposing a fee on banks to help recover some of taxpayers’ costs of bailing banks out from the financial crisis, according to multiple reports on Monday.

The White House said President Barack Obama wants to ensure that taxpayers are paid in full. “That’s the president’s goal,” White House spokesman Robert Gibbs told reporters. He declined to provide details on how that might be done.

Politico, the Wall Street Journal and New York Times, in nearly identical stories on their websites, cited administration officials saying that a bank fee was under consideration and might be included in the president’s budget proposal next month.

Such a fee, which would likely be highly popular with taxpayers still angry at bankers who are preparing to reap huge bonuses, could be part of next month’s budget. Exactly what form such a fee might take will be hotly discussed but it is unlikely to be a broad-based fee on transactions.

A fee on financial transactions was suggested by British officials at a meeting of Group of Seven finance ministers last fall, but was opposed by U.S. Treasury Secretary Timothy Geithner.

New York Attorney General Cuomo seeks 2009 bonus data from Wall Street

By Elinor Comlay and Jonathan Stempel

NEW YORK, Jan 11 (Reuters) – New York’s attorney general asked eight major U.S. banks to turn over data on planned bonuses for 2009, amid a growing public outcry over payouts in light of the industry’s role in the near-collapse of the financial system and recession.

Andrew Cuomo made the demand Monday to the banks that were first to receive federal bailout money in the fall of 2008: Bank of America Corp, Bank of New York Mellon Corp, Citigroup Inc, Goldman Sachs Group Inc, JPMorgan Chase & Co, Morgan Stanley, State Street Corp and Wells Fargo & Co.

These banks have all repaid infusions taken from the government’s much-maligned Troubled Asset Relief Program (TARP), though some of the U.S. investment in Citigroup has been converted into common stock.

U.S. lawmakers press for Geithner testimony on AIG payment information

By David Lawder

WASHINGTON, Jan 8 (Reuters) – U.S. lamakers on Friday pressed for Treasury Secretary Timothy Geithner to testify on whether the New York Federal Reserve Bank improperly pressured AIG to withhold information on payments it made to banks after its government bailout.

The requests came even as the Obama administration and the New York Fed rushed to say that Geithner, who headed the reserve bank at the time of the AIG rescue, was unaware of any emailed advice by Fed lawyers to limit disclosures.

Edolphus Towns, chairman of the House of Representatives Oversight and Government reform committee, said he asked Geithner to testify on the matter the week of Jan. 18 at a hearing to examine emails between New York Fed and AIG lawyers that show AIG was advised to withhold “key details” of the bailout terms from the public.

Unlimited credit for Fannie, Freddie seen as backdoor U.S. bailout

By Corbett B. Daly

WASHINGTON, Jan 5 (Reuters) – At a hearing last fall, U.S. Treasury Secretary Timothy Geithner told lawmakers that he and his team were working to put the $700 billion financial bailout fund “out of its misery.” But some in Washington now see a second, backdoor bailout in its place.

On Dec. 24, the Obama administration announced it was extending an unlimited credit line to mortgage finance agencies Fannie Mae and Freddie Mac, which would keep them afloat no matter how high their losses.

Representative Dennis Kucinich, an Ohio Democrat who was an early opponent of Obama in the 2008 presidential race, thinks the move is backdoor way to help banks, and a congressional subcommittee he leads is investigating the Treasury’s decision to cover unlimited losses at the housing finance companies.

Treasury to dole out $3.8 billion to GMAC, raise stake

By Karey Wutkowski and Corbett Daly

WASHINGTON, Dec 30 (Reuters) – The U.S. is injecting another $3.8 billion into GMAC Financial Services to help cover mortgage losses, in a bailout that makes the government the majority owner of the auto and home finance company.

GMAC said after the capital infusion it does not expect to record more major losses from its mortgage lending unit, which should help stabilize results.

The company is one of the largest car loan makers in the United States, and earning profit will give it more capacity to make loans and eventually pay back the government.

U.S. delays its $5 billion Citi sale after weak pricing

By Dan Wilchins and David Lawder

NEW YORK/WASHINGTON, Dec 16 (Reuters) – The U.S. Treasury delayed a plan to sell its $5 billion of Citigroup Inc shares after a stock offering by the bank attracted weak demand and priced at a much lower-than-expected $3.15 a share.

The bank sold $20 billion of stock and convertible bonds to repay funds it owes to the government so it can avoid the executive compensation restrictions that came with multiple U.S. bailouts.

But raising that capital came at a steep cost to shareholders, whose shares are worth 20 percent less than their closing level on Friday, before the bank announced its plan for repaying funds to the government.

Greek bailout not under discussion, markets suffer

By Harry Papachristou and Anna Willard

ATHENS/PARIS, Dec 15 (Reuters) – Greece is not discussing a bailout with other European Union countries, Greek Finance Minister George Papaconstantinou said on Tuesday, when financial markets gave his emergency deficit-cutting plan a thumbs down.

Speaking following a meeting with his French counterpart in Paris, Papaconstantinou also said his country was doing everything necessary to reduce its public deficit.

“There is no question of a bailout. There is absolutely no question of a bailout and we are not discussing that with our (European) colleagues,” he told reporters.

US Treasury to net $936 million from JPMorgan warrants

WASHINGTON, Dec 11 (Reuters) – The U.S. Treasury Department on Friday said it priced warrants in JPMorgan Chase & Co at $10.75 per warrant in a deal that will bring U.S. taxpayers net proceeds of $936.06 million.

The 88.4 million warrants to purchase common stock in JPMorgan were priced in a modified Dutch auction. The sale marks the disposal of the government’s remaining investment in the banking giant, which the Treasury received last year in exchange for $25 billion in bailout money.

The closing of the warrant sale is expected to occur on or about Dec. 16. Deutsche Bank Securities was the sole bookrunner, with Ramirez & Co., The Williams Capital Group and Utendahl Capital Group co-managing the offering.

Citi could sell $20 billion of shares soon to repay TARP – CNBC

NEW YORK, Dec 9 (Reuters) – Citigroup Inc plans to pay back TARP by raising money in an equity offering that could be announced as early as Thursday and could be some $20 billion, television network CNBC reported, citing sources.

Earlier on Wednesday, the bank’s chairman, Dick Parsons, told CNBC that Citigroup was in talks with regulators about repaying the funds it received from the U.S. Treasury’s Troubled Asset Relief Program.

“We believe Citigroup is in a position to repay the TARP money, but there is an active discussion we have to have with regulators …” said Parsons, who was at New York Governor David Paterson’s speech on the economy on Wednesday at the Museum of American Finance.

UK banks Lloyds, RBS agree to massive shakeup

A pedestrian passes the head office of the Lloyds Banking Group in central London August 5, 2009.    REUTERS/Stefan Wermuth (BRITAIN BUSINESS)    By Clara Ferreira-Marques and Steve Slater
LONDON, Nov 3 (Reuters) – Britain’s two largest retail banks secured another 31 billion pounds ($50.5 billion) from the government on Tuesday and agreed to sell branches and key businesses to appease EU competition concerns over state aid.