Treasury Doles Out $386M To 23 Banks

(AP)  The Treasury Department said Tuesday it has distributed another $386 million to 23 banks, the first awards from the federal bailout fund since President Barack Obama took office.

The department said the latest capital infusions went to banks in 16 states, bringing the total number of institutions that have been helped to 317.

The new distributions were made Friday and mark the first money from the $700 billion bailout fund distributed since Obama became president last week. Under the law that established the fund, the administration has to publicly disclose its funding actions within two business days after the money is disbursed.

The latest capital infusions ranged from $111 million for 1st Source Corp. in South Bend, Ind., to $1.04 million for Calvert Financial Corp. in Ashland, Mo.

With the new awards, a total of $194.2 billion has been provided in the program that is purchasing bank stock as a way to bolster banks' capital reserves and get them to resume more normal lending patterns. The money has gone to 317 institutions in 43 states and Puerto Rico.

Separately, the Federal Reserve - as required by a 2008 law that set up the $700 billion bailout fund - adopted a policy Tuesday aimed at preventing home foreclosures. The goal is to avoid foreclosures on residential mortgages that are held, owned or controlled by any Federal Reserve bank. The Fed said it will apply the policy to residential mortgage assets that serve as collateral for emergency loans provided by the Fed as well as to special entities it set up to hold certain assets of Bear Stearns and insurer American International Group.

Also on Tuesday, Treasury Secretary Timothy Geithner announced on his first full day in office that the administration was implementing new rules to limit special-interest influences on the bailout program.

The new rules will restrict the contact that government officials can have with lobbyists for the financial institutions seeking awards. They also will require reports in which the officials operating the rescue fund will have to provide Congress with a detailed description of how their review process was conducted.

The Bush administration committed the first $350 billion of the rescue fund in ways that left many lawmakers fuming about a lack of accountability and transparency in the program. While lawmakers failed in an effort to block release of the second $350 billion, the Obama administration said it would institute a number of reforms.

[tincup356]

there is not a word that comes out of the mouth of any politician that is not a lie...not one.

[tincup356]

party blind fools....they are working together to destroy the middle class Both parties could care less what happens to the people, people screamed bloody murder at the thought of the government helping common people try to keep what they have.....but give billions to greedy bankers who will not loan out that money they got at almost NO interest and charge as much as they can ,,when they loan it and then normal citizens wont be included,,,,,not to mention 118 billion in bonuses to execs.....congress is committing TREASON.

[luvcomments]

panacam

You are absolutely correct. Decades ago I had a genius IQ boss who said the same thing about the corporations and commercial greed in general. However, he went on to say that people are too flock of sheep indoctrinated to use their clout and, besides, they''re too busy making their refrigerator payments and watching their favorite show. We moan about our freedoms being taken away but....they aren''t; they''re given away.

[panacam]

I think we as American''s forget just how much clout we have againest these financial institutions. Let''s consider this: Everyone goes out and max''es out thier credit cards and at the same time, hold off paying their morgtgage. How long will it take before the entire financial system falls on its butt? Banks and financial institutions think they have problems now, what if...? I think it''s about time the B & F''s start lending the money given to them and quit worring about their "bottom lines" otherwise the American Public will get wise and fix their ''bottom lines'' but good!

[panacam]

Why are they giving it to the banks who are the ones responsible for the financial mess to begin with. Why don''''t they just give every American $1,000,000.00 dollars in which they decide what to do with it and as we all know many will spend it and have nothing but junk to show for it yet thats what we call an economic boost putting money back into the system by spending. Giving it to the banks does nothing giving it to the people is the right thing they can buy those homes, new cars..etc etc with it and stimulate the markets


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Posted by cusefan21 at 11:48 AM : Jan 28, 2009

cusefan21 echos the same things many of us have said. What good does it do the banks to have the money? Many people out of work and out of money can''t pay their debts so filling the back-end of the problem is going to fix the problem? Not by my math! Cusefan21 is right when he says it may just get spent on "junk" but at least it will get spent! Now I don''t agree $1M is the right amount but at the current bail out levels, #10,000 would not be unrealistic.

[cusefan21]

Why are they giving it to the banks who are the ones responsible for the financial mess to begin with. Why don''t they just give every American $1,000,000.00 dollars in which they decide what to do with it and as we all know many will spend it and have nothing but junk to show for it yet thats what we call an economic boost putting money back into the system by spending. Giving it to the banks does nothing giving it to the people is the right thing they can buy those homes, new cars..etc etc with it and stimulate the markets

[luvcomments]

According to Nouriel Roubini, RGE Monitor Chairman, banks are getting the money but they are hoarding it, not lending it, as they expect higher losses.

[luvcomments]

I am curious (as well as obviously uneducated in economics :) Since the banks still aren''t lending money to consumers or businesses, what would be the ramifications - to the presently rich and non-rich - if we just let the banks go belly-up instead of pouring money into them for their undisclosed agenda?

[dumdnc]

texhillgirl-don''t forget the brown shirts and jack boots. I hear they voted for the taper cut shirt with tab collar. They should look dandy.

[dumdnc]

And 12million went to a little bank in Mass. that''s a pet of barney frank. But hey, that''s ok, isn''t it.
The only holdings this bank has are the subprime mortgages that are being brought to us by the dems. I also understand that fannie and freddie are getting a bunch of money so they can continue the practice of subprime lending. And, love the fact that acorn, the chosen one''s special pet project is gettin funds.
But, hey, it''s the dems and that''s the way business is being conducted.