US May Avoid More Bailouts by Trading Loans for Equity

Conversion could stretch bailout fund by $100 billion

By Clay Dillow, Newser Staff

Posted Apr 20, 2009 8:54 AM CDT

(Newser) – President Obama’s economic team has figured a way to keep the banks afloat without asking Congress for more money, by converting the government's existing bailout loans to common stock, the New York Times reports. The conversion plan could stretch Treasury’s fund by more... Read full story »

COMMENTS

Read the comment policy

You need to Log in to Newser to comment. Don't have an account yet? Sign up now!

There are no comments

A snapshot of the day's best news stories.

View Larger Grid

All Today Yesterday Pick a Date

What's Popular Now on Facebook

'Serpent Pastor' Dies of Snake Bite

Miami Face-Eater Identified

New York Times (Source Grid »)

Most banks will likely pass 'stress test'
Time

Nobel economist: I would be 'very surprised' if every bank passes stress test
Bloomberg

Stress tests may bring more problems to light
The Age

Politics • Money

Citigroup • nationalization • subprime crisis • bailout • commercial banks • financial crisis

More Newser Stories

Pay Czar to Examine Salaries at Bailed-Out Firms

Feinberg to review compensation for top 25 executives

(NEWSER) - The "pay czar" will review salaries and bonuses of executives at financial firms that have received government help. Kenneth Feinberg will examine the compensation of the top 25 executives at Goldman Sachs, Citigroup, JPMorgan Chase, and 417 other firms that took TARP money. If he finds evidence of risky or improper compensation, he has the power to intervene—but not to "claw back" any payments already made. More»

Citigroup to Repay $20B in TARP Loans

Will issue $17B in common stock to meet capital requirements

(NEWSER) - Citigroup and the US government have reached a deal that will allow the bank to repay $20 billion in TARP loans, after weeks of wrangling over the bank's health. Citi will raise $20.5 billion, $17 billion of it in common stock, the company said in a statement, a sign that the government's still worried about its cash reserves. At the same time, the government will sell $5 billion of the Citi common stock it currently holds, with the remainder of its 35% stake gradually sold off within the next 6-12 months. More»

Wall St. Looks to Skirt Bonus Limits With Padded Salaries

Attempt to skirt new rules could anger shareholders

(NEWSER) - In a move to skirt government restrictions on executive pay for recipients of bailout cash, some Wall Street companies are discussing raising base salaries, the Journal reports. Citigroup and Morgan Stanley are considering the idea, which is gaining currency as regulators keep a watchful eye on bonuses, say industry insiders. Higher base salaries could actually help boost bonuses, typically a percentage of salary. More»

US to Take 36% Stake in Citi

Treasury will take up to 40% of bank in return for boardroom overhaul

(NEWSER) - Citigroup and the federal government have reached a deal to boost the US stake in the bank to up to 40%, the parties announced this morning. The deal gives shareholders more protection, but in return, agrees to a Treasury Department demand for an overhaul of the embattled bank's board of directors. The new board will include a majority of independent directors; CEO Vikram Pandit is expected to keep his job, the Wall Street Journal reports. More»

RBS Posts $34B Loss, Biggest in UK History, Gets 2nd Bailout

British taxpayer may soon own 95% of bank

(NEWSER) - The Royal Bank of Scotland today announced an annual loss of $34.3 billion, the largest in British corporate history, and the Treasury said it would inject another $36 billion into the troubled bank. The UK government already owns 70% of RBS, a figure that could now rise to 95%, reports the Times of London. Much of today's loss stems from RBS' purchase of ABN Amro, the Dutch bank it bought in 2007 in the largest ever banking takeover. More»

NEWS FROM OUR PARTNERS

What is Newser?

Face it: there's too much news. At Newser, we choose the most thought-provoking and entertaining stories from hundreds of US and international sources and reduce them to a headline, picture, and two paragraphs. And we do it 24/7—you can come back morning, noon, night (and in between) for something new that matters. Read less, know more.

Learn more »

Partnering with: Slate

View Newser on the mobile website

US May Avoid More Bailouts by Trading Loans for Equity

Conversion could stretch bailout fund by $100 billion

Citigroup • nationalization • subprime crisis • bailout • commercial banks • financial crisis

MOST POPULAR STORIES

[ By Views ]

[ By Comments ]

More Newser Stories

Pay Czar to Examine Salaries at Bailed-Out Firms

Feinberg to review compensation for top 25 executives

Citigroup to Repay $20B in TARP Loans

Will issue $17B in common stock to meet capital requirements

Wall St. Looks to Skirt Bonus Limits With Padded Salaries

Attempt to skirt new rules could anger shareholders

US to Take 36% Stake in Citi

Treasury will take up to 40% of bank in return for boardroom overhaul

RBS Posts $34B Loss, Biggest in UK History, Gets 2nd Bailout

British taxpayer may soon own 95% of bank

About Us

Site

Community

Site Maps

Tools

More News

What is Newser?