U.S. banks announce cash infusions Mon Oct 27, 2008 7:24am EDT Oct 27 (Reuters) - A string of U.S. banks have signed up for the government's offer of a cash injection in a bid to revive the sector, which has suffered since lending has dried up and many of the loans banks made have gone bad. The U.S. Treasury Department plans to provide funds for 20 to 22 additional lenders as part of its next round of a $250 billion bank recapitalization program. A list of banks that have announced they will use the government's funds follows: PNC Financial Services Group Inc (PNC.N: Quote, Profile, Research, Stock Buzz) $7.7 billion Capital One Financial Corp (COF.N: Quote, Profile, Research, Stock Buzz) $3.55 billion Regions Financial Corp (RF.N: Quote, Profile, Research, Stock Buzz) $3.5 billion KeyCorp (KEY.N: Quote, Profile, Research, Stock Buzz) $2.5 billion Huntington Bancshares (HBAN.O: Quote, Profile, Research, Stock Buzz) $1.4 billion First Horizon National Corp (FHN.N: Quote, Profile, Research, Stock Buzz) $866 million Valley National Bancorp (VLY.N: Quote, Profile, Research, Stock Buzz) $330 million Note: Wall Street Journal reported on Friday SunTrust Banks Inc (STI.N: Quote, Profile, Research, Stock Buzz) is also taking part in the plan.
Interesting, PNC used about $5B of the $7.7B in government TARP funds to buy Cleveland Based National City... NCC had about a $6/sh book value at the time, and PNC did the take under at around $2/sh... Regional consolidation in process...
WASHINGTON (AP) -- The Treasury Department will start doling out $125 billion to nine major banks this week to get credit flowing again, giving a lift to U.S. markets on rising confidence that the government's moves would stave off a protracted recession. ... The action will mark the first deployment of resources from the government's $700 billion financial rescue package passed by Congress on Oct. 3. The bailout package has undergone a major change in emphasis since it was passed by Congress. Treasury Secretary Henry Paulson decided to use $250 billion of the $700 billion to make direct purchases of bank stock, partially nationalizing the country's banking system, as a way to get money into the financial system more quickly. The plan is also aimed at clearing banks' balance sheets of bad assets. That effort has yet to begin although the administration expects to use $100 billion to purchase bad assets in coming months.
That is the way they should have done it in the first place, as some other countries (Sweden, eg) did this. Easier for the govt to get their $$ back if they come back...
UPDATED LIST 10/27/08 Following are banks that have announced participation in the Treasury program. Some company names have been shortened for space: FIRST ROUND Citgroup $25 billion Wells Fargo $25 billion JPMorgan Chase $25 billion Bank of America $15 billion Merrill Lynch $10 billion Goldman Sachs $10 billion Morgan Stanley $10 billion Bank of New York $3.0 billion State Street $2.0 billion TOTAL $125 billion SECOND ROUND PNC $7.7 billion Capital One $3.6 billion SunTrust $3.5 billion Regions Financial $3.5 billion Fifth Third $3.4 billion BB&T $3.1 billion KeyCorp $2.5 billion Comerica $2.25 billion Northern Trust $1.5 billion Huntington $1.4 billion First Horizon $866 million City National $395 million Valley National $330 million Washington Federal $230 million UCBH Holdings $298 million First Niagara $186 million Old National $150 million* HF Financial $25 million Redding Bank $17 million Provident --** TOTAL $34.93 billion (35.18) *Old National hasn't decided whether to participate. **Provident didn't say how much it expects. *************************************************** New Website Tracking Bailout largesse, servicing contracts with compensation 'lined out" etc. http://bailoutsleuth.com/
Is there anything preventing bank executives from giving themselves a big bonus? What if the bailout funds never get to the banks, the money just disappears?
NBC Nightly News Brian Williams reported the Big 3 IB banks have the bonus money on hand and ready to go - but have not made a disbusement decision and that regulatory threats have been made by Congress over this issue. Last year at this time - recall that GS had 16 Billion Dollars in the bank for employee bonuses.
In the bail out bill, they have the exec com capped for FUTURE contract and not the current ones. The excuse is that if caps are applied to current contract, banks won't participate! That's why the investment banks will still have 20B of taxpayers money for this year's bonus. I swear. One day, people holding forks, pitches and torches will show up at these CEOs office.
Also, get this. Once these banks get the money, they are not lending it out. They either hold it or they use it to buy out competition. Yea, good plan Paulson. On the other hand, don't hold grudges to smaller banks. If big banks get help, it is only fair smaller ones get it too.