WASHINGTON — It’s one of the ironies of the U.S. financial bailout: The banking executives now managing billions in taxpayer money are the same ones who oversaw the industry’s near collapse.
At banks receiving federal bailout money, nearly nine of every 10 of the most senior executives from 2006 are still on the job, according to regulatory and company documents.
More than 100,000 bank employees were laid off during a two-year stretch when industry unemployment nearly tripled, bank stocks plummeted and credit dried up.
“The same people at the top are still there, the same people who made the decisions causing a lot of our financial crisis,” said Rebecca Trevino of Louisville, Ky., a mother of three who was laid off from her job as a Bank of America training coordinator in October. “But that’s what tends to happen in leadership. The people at the top, there’s always some other place to lay blame.”
Taxpayers are now shareholders in the nation’s bailed-out banks, yet they lack the usual shareholder power to question management decisions or demand house-cleaning in the executive suites.
Wells Fargo once was among the top lenders for subprime mortgages, loans to buyers with low credit scores. The firm received $25 billion in bailout money and plans layoffs in the coming months. But longtime chief executive Richard Kovacevich, left, remains the company’s chairman. The Associated Press
