President Obama met Monday with executives from some of the nation’s biggest banks at the White House to talk about the economic recovery, lending to small businesses, helping struggling homeowners and the administration’s push to overhaul financial regulations.
The meeting comes after Citigroup announced it had reached a deal with the Treasury Department to repay $20 billion in bailout money. The move will still leave the government with equity in the bank but will release it from strict executive compensation rules aimed at the largest recipients of money from the Troubled Asset Relief Program.
With many banks repaying their bailout money sooner than expected, the administration said it anticipated losses would be $200 billion less than expected. Obama wants to use some of that money to spur small-business lending. It’s unclear how large banks could help that effort, since most loans to small businesses come from smaller community banks.
Obama was scheduled to make comments about the economy after the meeting.
Citigroup Chairman Richard Parsons was one of three executives, along with Goldman Sachs chief Lloyd Blankfein and Morgan Stanely chief John Mack, who were unable to fly into Washington today because of fog in the area. They participated via conference call.
Among the 10 executives at the White House today are the chief executives of Wells Fargo & Co., JP Morgan Chase & Co., Bank of America Corp., Bank of New York Mellon Corp. and American Express Co. Joining Obama at the meeting were Treasury Secretary Timothy F. Geithner, Chief of Staff Rahm Emanuel and top White House economic advisors Lawrence Summers and Christina Romer.
Obama met with them a day after describing them in an interview as “fat-cat bankers.”
Asked about Wall Street firms paying huge bonuses to their executives, Obama told CBS’ “60 Minutes”: “I did not run for office to be helping out a bunch of, you know, fat-cat bankers on Wall Street. The only ones that are going to be paying out these fat bonuses are the ones that have now paid back that TARP money.”
Obama said “there is no doubt” that some of the bonuses were possible because of the government bailouts.
“And what’s most frustrating me right now is you’ve got these same banks, who benefited from taxpayer assistance, who are fighting tooth and nail with
their lobbyists up on Capitol Hill, fighting against financial regulatory reform,” Obama said.
Many large banks oppose some of the tougher financial regulations that Obama has proposed. On Friday, the House passed the overhaul, the most sweeping since the Great Depression. But the Senate still must act on the measure.
(c)2009, Chicago Tribune. Source: McClatchy-Tribune Information Services.