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WEDNESDAY, NOVEMBER 25, 2009
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 OPINION 
4

Banks Have Gotten a Bum Rap: BofA Chief Ken Lewis

The steps already taken are working, so let the market sort it out

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(Newser) – Banks have been unfairly tarred by misconceptions about the current financial crisis, Bank of America CEO Kenneth Lewis argues in the Wall Street Journal. It's not true that banks aren't lending, he writes. They are just doing so more responsibly, as they should. And it's not true that bad banks are being protected: "The companies that did the most to cause this mess are gone." Lewis argues that most banks are solvent; "we've seen fewer than 50 bank failures," and most of the rest will survive.

It's not true that taxpayers are giving banks charity, Lewis says—TARP funds are loans, and " taxpayers are getting a strong return on their investment." But the premise that nationalization is the only way to fix US banks is the worst misconception, Lewis writes. “Nationalization would undermine confidence in the financial system and send shudders through the investment community.”

"We agree with Federal Reserve Chairman Ben Bernanke's statement that nationalization of banks is not necessary to stabilize the banking system," Bank of America's CEO Kenneth Lewis writes.   (AP Photo)
Treasury Secretary Timothy Geithner shouldn't rush to take bigger government stakes in banks when the governments previous actions are having measured success, Lewis writes.
Treasury Secretary Timothy Geithner shouldn't rush to take bigger government stakes in banks when the governments previous actions are having measured success, Lewis writes.   (AP Photo)
Kenneth Lewis, Chairman, President and CEO of Bank of America answers questions after speaking in Detroit on Nov. 18, 2008.
Kenneth Lewis, Chairman, President and CEO of Bank of America answers questions after speaking in Detroit on Nov. 18, 2008.   (AP Photo)
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Let competitive forces lead us back to responsible lending practices, not the type of indiscriminate lending that has created so many problems.
- Kenneth Lewis, Wall Street Journal

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4 comments
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Observer
Mar 9, 09 9:32 AM CDT
What was Ken Lewis' bonus value the past 5 years. Greed fueled this disaster. Wall Street and the Banks are equally responsible. Of course most banks are viable - same with insurance companies and pension funds. It is the AIG, Fannie Mae, Madoff and Lehman thugs that need prison time. And take away their country club memberships. Reply
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justhinkin
Mar 9, 09 11:10 AM CDT
Lest we forget, it was politican's Carter, Clinton, Kennedy and Franks,et al, that required banks to make loans to underqualified applicant's. Just TRY to take away their country club memberships, or put them in prison! Reply
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IN RESPONSE:
Doctor_Zaius
Mar 9, 09 1:00 PM CDT
Subprime loans were not covered by the CRA. Please take this Talking point and put it where it belongs. In the trash.
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SPH
Mar 9, 09 9:21 PM CDT
"Nationalization would undermine confidence in the financial system"...too late...It could not possible be worse..... Reply
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