More TARP recipients want out
The AIG bonus spectacle of last week convinced Goldman Sachs to repay their TARP money ASAP, thus defeating the purpose of having taken it in the first place.
Now comes the unsurprising news that more banks want out of TARP:
For relatively strong banks, doing business with the government may be more trouble than it’s worth.
Banks are publicly declaring their intent to pay back loans from the Troubled Asset Relief Program, or TARP, as quickly as they can. They range from Charlotte-based Bank of America Corp., which is the country’s biggest bank, to tiny Iberiabank Corp. in Lafayette, La.
The banks complain about the rules that the U.S. Treasury keeps imposing on them retroactively, sometimes in ways that seem arbitrary or driven by constituents’ anger.
Some say they never needed the money but were cajoled into taking it by the Treasury, which wanted a show of industry support for its program.
Others say they’re dismayed by the public’s outrage toward banks that participate in TARP, which was originally touted as a reward of sorts for healthy banks.
That’s not exactly how TARP was described at the time, especially since the article notes that “The Treasury basically ordered nine of the nation’s biggest banks… to participate in the program,” but never mind. Call it an object lesson in human behavior when one vilifies the bankers needed to help fix the financial sector.
(Hat tip: Hot Air)
March 28th, 2009 at 3:31 pm
The public has every right to be upset at retention bonuses that are 4 million dollars and up.
Are these merit bonuses??
I don’t think so, unless you assert creating monumental losses is meritorious.
It seems that executives are making the claim (often self-erving) that the retention bonuses serve to retain knowledgeable people WHO CAN CLEAN UP THE MESS.
The public is outraged because of the distinct possiblity that the “clean up crew” is substantially the same as the “wrecking crew”.
And firms like AIG have done a very poor job of delineating that that identity is not the case.
Just my 2 cents worth.
Robert A. Kearse