Spring Break
Banks still in distress, Geithner tells overseers
Associated Press
Issue date: 4/22/09 Section: News
|
How well is the mostly-spent $700 billion federal bailout working? "To date, frankly, the evidence is mixed," Geithner told a congressionally appointed oversight panel.
Confidence in the program is wearing thin on Capitol Hill. With lawmakers back from their spring break, even bailout supporters are skeptical that Congress - weary of bankers' bonuses and still-scarce credit - would approve additional bank rescue money if requested.
Geithner's testimony signaled that the administration was not preparing to ask.
Wall Street was cheered by Geithner's assessment that "the vast majority" of banks could be considered well-capitalized. Bank stocks had slid on Monday but bounced back on Tuesday.
Still, the government's effort to stabilize the financial sector and unclog credit markets has come under heavy scrutiny. Officials must do a better job in carrying out and explaining its efforts to shore up the financial system, the head of the oversight panel told Geithner.
"The sense of fear and uncertainty has not gone away, but it's been joined by a new sense of anger and frustration," said Elizabeth Warren, who is also a Harvard University law professor. "People are angry that, even if they have consistently paid their bills on time and never missed a payment, their TARP-assisted banks are unilaterally raising their interest rates or slashing their credit lines."
Of the $700 billion authorized by Congress for the Troubled Asset Relief Program last October, Geithner said about $110 billion is left. With about $25 billion expected to be repaid this year, the total available is about $135 billion.
Be the first to comment on this story