WASHINGTON — Top executives of the nation’s biggest banks said Friday after meeting with President Barack Obama that they will work with the administration on its economic recovery plans.
Bankers said an administration proposal to jump-start lending, a problem at the heart of the industry’s crisis, is encouraging.
“People are looking at that. It’s positive,” Morgan Stanley’s John Mack told The Associated Press in an interview. “We think it’s the right thing to do, and now we just need to get the details.”
The administration announced a program this week to help banks free themselves of so-called toxic assets. These investments have tied up capital and kept banks from resuming more normal lending to consumers and businesses.
The plan calls for the administration to partner with private investors, the Federal Reserve and the Federal Deposit Insurance Corp. to buy as much as $1 trillion in toxic assets from banks. But one concern is whether private investors will participate and whether banks would be willing to sell the assets at the reduced prices they will be offered for them.
Bankers described a positive meeting and pledged to work with Obama on restoring the economy’s health.
Obama invited chief executives from the 15 largest banks to the White House to discuss the economy and other issues.
Jamie Dimon of JPMorgan Chase & Co., Vikram Pandit of Citigroup Inc., Ken Lewis of Bank of America Corp., John Stumpf of Wells Fargo & Co., John Koskinen of Freddie Mac and Kenneth Chenault of American Express Co. were among those who attended. Treasury Secretary Timothy Geithner met privately with the CEOs on Thursday night and sat in on Friday’s meeting.
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Banks look to corner derivative market
WASHINGTON — Seven banks that needed government bailouts after making disastrous bets on over-the-counter derivatives are seeking monopoly control over dealing in that market.
The banks already control a big part of the multitrillion-dollar derivatives market, but they have to compete with broker-dealers, hedge funds and other players. Many industries use derivatives contracts to reduce risk.
The banks making the play for control are Deutsche Bank AG, Barclays, JPMorgan Chase & Co., Goldman Sachs Group Inc., Credit Suisse Group, Morgan Stanley and Citigroup Inc.
