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Citigroup And Government Not Seeing Eye To Eye On TARP Repayment

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Why (serious question) do they have to raise any capital at all? Isn't the fact that they're "the world's most global bank in a world that becomes more global every day" good enough? Would a free coupon to Tickle a Vickle Town do the trick?

The disagreements are related to last week's announcement by the Treasury Department that Bank of America Corp. won approval to repay its $45 billion in federal aid. The Charlotte, N.C., bank sold about $19 billion in common stock late Thursday as part of its repayment strategy.

Officials at Citigroup and Wells Fargo have prodded U.S. officials to let them proceed under similar terms, according to the people familiar with the matter. Bank officials are worried they could be at a competitive disadvantage if they don't quickly follow Bank of America by repaying their TARP funds.
Citigroup is looking to redeem $20 billion of preferred stock, while Wells Fargo got $25 billion from TARP. Citigroup executives have been told they would need to raise $20 billion in common stock to exit TARP, according to the people familiar with the matter. Wells Fargo also was told it would have to drum up billions of dollars in new capital

Banks, US Spar Over TARP Repayment [WSJ


Wells Fargo.Insane

Wells Fargo Trading Up On The Not-So-Soft Bigotry Of Extremely Low Expectations

Investors seem psyched that Wells even got out of bed today.

TARP Charts!

The Federal Reserve has this new paper out about TARP that does a bit of highly suggestive eyebrow raising about some banks that shall remain nameless. They start from the awkward fact that TARP wanted everything in one bag but didn't want the bag to be heavy, or as they put it: The conflicted nature of the TARP objectives reflects the tension between different approaches to the financial crisis. While recapitalization was directed at returning banks to a position of financial stability, these banks were also expected to provide macro-stabilization by converting their new cash into risky loans. TARP was a use of public tax-payer funds and some public opinion argued that the funds should be used to make loans, so that the benefit of the funds would be passed through directly to consumers and businesses. So you might reasonably ask: were TARP funds locked in the vault to return the recipient banks to financial health, or blown on loans to risky ventures, or other? Well, here is Figure 1 (aggregate commercial and industrial loans from commercial banks in the U.S.): So ... not loaned then. But that's not important! The authors are actually looking not primarily at aggregate amounts of loans but at riskiness of loans and here's what they get: