U.S. Says Ailing Banks Need $75 Billion

Federal regulators told the country’s 19 largest banks that they must raise $75 billion in extra capital by November, a more upbeat verdict on the health of the financial system than the industry had feared just two months ago.

Ten of the 19 bank holding companies deemed “too big to fail” by the Obama administration will be required to raise additional capital, according to the results of the government’s stress tests, released late Thursday afternoon. But the 10 banks will have to raise much less capital than some analysts had expected as recently as a few days ago.

“With the clarity today’s announcement will bring, we hope banks are going to get back to the business of banking,” Treasury Secretary Timothy F. Geithner said during a news briefing on Thursday afternoon.

Mr. Geithner noted that banks had a long way to go to restore the nation’s confidence in the financial industry, and that they could get a start in generating good will by lending more.

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Posted in * Economics, Politics, Economy, The 2009 Obama Administration Bank Bailout Plan, The Banking System/Sector, The Credit Freeze Crisis of Fall 2008/The Recession of 2007--

2 comments on “U.S. Says Ailing Banks Need $75 Billion

  1. robroy says:

    Obama had announced a $100 million deficit reduction (well, they promised they would work on developing a plan to cut $100 over the next 90 days). For a great video demonstrating how minuscule this really is see [url=http://www.youtube.com/watch?v=cWt8hTayupE ]here[/url]. Now, he has announce that he will be seeking do decrease the budget by $16 billion. If you watch the video, that would be 8 stacks of five or 40 pennies. But is he really going to cut it, or is it just going to be “cut” so that he can raise the deficit spending by $75 billion to give to the banks???

  2. tgs says:

    “Mr. Geithner noted that banks had a long way to go to restore the nations confidence in the financial industry – ” Really? No kidding? Mr. Geithner also needs to note that the federal government has billions and trillions times further to go to restore the nations confidence in the federal government. (I’m using billions and trillions as a measure since the federals only seem to recognize billions and trillions as numbers now.)