Citigroup and Wells Fargo said their individual banks will repay billions in TARP money lent to them, a move that in The Wall Street Journal's words will "begin extracting themselves from the U.S. government's grip."
With Wells Fargo's announcement late Monday, all nine of the giant banks that were first to pocket TARP funds last year are on track to repay their infusions. J.P. Morgan Chase & Co., Goldman Sachs Group Inc. and Morgan Stanley paid the government back in June. Last week, Bank of America wired its $45 billion repayment to Treasury.
Internally, Citigroup also announced plans to issue $1.7 billion of common stock equivalents to employees in January, in lieu of cash bonuses. A Citigroup spokesperson told PRWeek the news was communicated to workers via e-mail and company Web site.
The White House on Monday pressed the bankers to lend more to small businesses and others, demonstrating the constant negotiation still going on in the financial sector. From The Christian Science Monitor:
At some point in 2009, a power shift occurred in US politics. Big financial institutions went from needing Washington's help in avoiding an abyss to Washington seeking their help for economic recovery and job creation.
This whipsaw of power was on display for all to see Monday when President Obama talked with 12 top bank executives at the White House.
Unfortunately, some of the bank executives might have caused another flap by not showing up.