WASHINGTON — The Federal Deposit Insurance Corp. is asking banks tapping the $700 billion U.S. financial rescue program to report how they are using the funds to support consumer lending and foreclosure relief.
State banks regulated by the FDIC should start monitoring spending from cash injections, liquidity support and financing guarantees received from programs including the Troubled Asset Relief Program established by the Treasury Department, FDIC and Federal Reserve, the agency said in a letter to banks. A summary was posted on the FDIC website Monday.
“We are not looking for specific reporting requirements, but rather they monitor TARP funds and how they are being used, particularly to support prudent lending,” FDIC spokesman David Barr said Monday.
Democratic lawmakers have faulted the Bush administration for distributing $350 billion from the financial-rescue fund approved in October without setting conditions on the recipients.
President-elect Barack Obama on Monday requested that Bush ask Congress for the remaining $350 billion in rescue funds while his team drafts proposals to stem mortgage foreclosures. Bush said that he is willing to act on Obama’s behalf.
