Pay Me What You Owe Me

Are Bonuses On The Table

This month Bank of America (BOA) has repaid the entire $45 billion it owed U.S. taxpayers as part of the Troubled Asset Relief Program and Citigroup, Inc. plans to pay back TARP by raising money in an equity offering.
It seems these banks are getting ready to issues bonuses and they can’t do that as long as they are under the scrutiny of the TARP Program…coincidence, I don’ think so.

Repayment of the funds frees BOA from the government restrictions that have hampered its search for a new CEO, including executive pay limitations.

Bank of America’s Chief Risk Officer Gregory Curl and Brian Moynihan, the head of consumer banking, are among the top contenders. However, both men have been criticized by analysts as lacking experience or being too close to the Merrill deal.

Bank of America was among hundreds of banks that received government support through the government's TARP program. The bank received $25 billion as part of the initial round of investments when the credit crisis peaked last fall. It received an additional $20 billion in January shortly after it acquired Merrill Lynch in what was a heavily scrutinized deal.

Click here to read the article The Monster we created.

Bank of America said it was going to pay the government back through a combination of cash on hand and the sale of securities that would convert into common stock.

I still wonder why we allow these banks to borrow tax payer money at 1% to stay solvent and allow them to turn around and charge us 18% to 30% on our credit card balances.

I find it hard to believe that no one thought of this and included in the framework of the TARP Program. There should have been certain stipulations and restrictions before we allowed this deal to go through.

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