Bank to Pay Back TARP Money After Golf Dust-Up

Discussion in 'Wall St. News' started by ASusilovic, Feb 28, 2009.

  1. Northern Trust sees a sand trap in TARP.

    The Chicago-based bank said Friday evening that it would repay the government more than $1.5 billion “as quickly as prudently possible” following a hail of criticism from Capitol Hill over its lavish entertainment spending at a golf tournament last week.

    In a letter to Representative Barney Frank, Frederick H. Waddell, the bank’s chief executive, defended flying hundreds of its employees and clients to the Northern Trust Open in suburban Los Angeles and providing luxury hotel rooms and entertainment from such performers as Chicago, Sheryl Crow and Earth, Wind & Fire.

    He reasserted that the bank did not rely on any government money for the tournament entertainment.

    Mr. Waddell contended that entertaining clients fell within the guidelines the bank accepted when it took the money from the Troubled Asset Relief Program, or TARP, in October. But, he said, “we will redouble our efforts to ensure that these activities are appropriate given the current environment.”

    On Tuesday, Mr. Frank, the chairman of the House Financial Services Committee, sent Mr. Waddell a letter demanding that Northern Trust immediately reimburse the government for the cost of the golf tournament and entertainment.

    “We are dismayed and angered to learn that Northern Trust recently spent millions of dollars on a PGA golf tournament sponsorship and associated parties at the same time it has taken over $1.5 billion in federal stabilization funding,” Mr. Frank wrote in a letter also signed by the 17 other Democratic committee members. “This behavior demonstrates extraordinary levels of irresponsibility and arrogance.”

    In response, Mr. Waddell told Mr. Frank that the bank would repay the TARP money under the new rules set out in President Obama’s economic stimulus plan. “Northern Trust has engaged our regulators with the goal of repaying Capital Purchase Program funds as quickly as prudently possible under the new guidelines,” he wrote.

    Northern Trust would not be the first bank to return TARP money. That honor belongs Iberiabank in Louisiana, which said late Thursday that it would send $90 million back to the government. There was no word of whether it planned to sponsor a golf tournament.

    http://dealbook.blogs.nytimes.com/2...ack-tarp-money-after-golf-dust-up/#more-32943

    :D :p :)
     
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  3. lrm21

    lrm21

    Besides being headmaster at an all boys boarding school, Barney Franks other wet dream is nationalizing all banks and making the government the only lender

    Expect letters such as

    Mr Smith

    It unamerican for you to take a 14 day cruise when you have an outstanding loan with the federal government.
     
  4. Love is in the air

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  5. Great. Now, I'll have nightmares.
     
  6. “We are dismayed and angered to learn that Northern Trust recently spent millions of dollars on a PGA golf tournament sponsorship and associated parties at the same time it has taken over $1.5 billion in federal stabilization funding,” Mr. Frank wrote in a letter also signed by the 17 other Democratic committee members. “This behavior demonstrates extraordinary levels of irresponsibility and arrogance.”



    at first, i thought he was referring to CONgress?:D
     
  7. Daal

    Daal

    Its like frank became an expert on advertising and he knows what works and what doesn't. Any type of advertising that involves symbols of wealth like golf dont work and are a waste of money according to his extensive empirical research
     
  8. cstfx

    cstfx

  9. patchie

    patchie

    “as quickly as prudently possible”

    If you didn't need the Capital, and you did not spend it foolishly, the money should be available immediately. I wonder how long it will take Northern to be prudent and return the money.

    I'll bet those 3-4 days of parties and concerts cost the firm $250K - $500K when you factor in travel and Hotel stays. That is 1/3 of the money they borrowed. But somehow we are to believe that the two accounts of money never crossed.
     
    #10     Mar 2, 2009