“The best response to the housing bubble would have been regulatory, rather than monetary,” Bernanke said yesterday in remarks to the American Economic Associations annual meeting in Atlanta. The Feds efforts to constrain the bubble were “too late or were insufficient,” which means that regulatory actions “must be better and smarter,” he said.
Bernanke said the Fed is improving supervision of banks and has strengthened measures to protect consumers of financial products. Senate Banking Committee Chairman Christopher Dodd, who backs Bernanke for a second term, has called - - - - >

Marshall & Ilsley tumbled 60 percent, the indexs biggest drop, according to data compiled by Bloomberg. Huntington Bancsharesfell 52 percent, Citigroup dropped 51 percent and Zions Bancorporationdeclined 48 percent. Banks accounted for seven of the 10 worst performers in the index.
“The problem is primarily capital, dilution and credit,” said Gary Townsend, president of Hill-Townsend Capital LLC in Chevy Chase, Maryland. “There are still questions that remain with respect to the solvency of many banks, and those undoubtedly are the ones in which investors have the greatest - - - - >

Kenneth Feinberg, the Obama administrations pay czar, said in a letter to the company that the repayment removes Citigroup from restrictions on executive pay and bonuses that were imposed on companies receiving exceptional assistance from the $700 billion bailout fund.
Those restrictions will now cover only insurance giant American International Group and auto companies Chrysler and General Motors and their financing arms.
Citigroup last week sold common stock to raise the cash it needed to repay $20 billion of the $45 billion stake the government held in Citigroup. But the Treasury postponed its own plans to begin selling its 34 percent stake - - - - >

The move came after investors responded tepidly to a massive stock offer by the New York-based bank. Citi said Wednesday it will sell 5.4 million common shares at a steep discount to raise the cash it needs to repay $20 billion of the $45 billion in government support it received to weather the financial crisis.
Citi is the last remaining Wall Street bank in which the government still owns a major stake. Treasurys move underscores the Obama administrations halting progress in drawing back the tens of billions of dollars it invested to stabilize the banking sector.
In what it called the largest - - - - >

Citigroup sold 5.4 billion shares at $3.15 apiece, less than the $3.25 the government paid when it acquired its stake in September. The New York-based bank said the Treasury wont sell any of its shares for at least 90 days.
Investors demanded a bigger discount from Citigroup than Bank of America Corp. or Wells Fargo & Co., which together raised more than $31 billion this month to exit the Troubled Asset Relief Program. Wells Fargo, which trumped Citigroups bid to buy Wachovia Corp. last year, leapfrogged its - - - - >

ADIA, as the sovereign fund is known, filed an arbitration claim alleging “fraudulent misrepresentations,” and is seeking more than $4 billion in damages if the deal is upheld, Citigroup said in a statement yesterday, adding that the claims have no merit. ADIA invested in November 2007, getting equity units that can be swapped into common stock at $31.83 to $37.24 a share from 2010. The shares closed at $3.56 in New York yesterday.
Citigroup, which on Dec. 14 said it would sell stock to repay $20 billion - - - - >

Citigroup Inc., whose future looked uncertain at the beginning of this year, will repay $20 billion, while Wells Fargo & Co. will pay back the $25 billion it received. Both banks announced significant capital raises in order to repay the money, and the government will also sell the one-third stake it holds in Citigroup.
The move frees the two from the close regulatory scrutiny that accompanied aid from the Troubled Asset Relief Program, which the government put in place at the height of the financial crisis in the fall of 2008. The Treasury Department said that of the $245 billion given - - - - >

Thats the amount of assets left in Citi Holdings, the division that Pandit set up to strip his bank of unprofitable businesses, troubled loans and securities. While the bank has unloaded almost $100 billion of the assets so far, getting stuck with the rest may hinder earnings for years, analysts said.
“I wouldnt say that all of their issues are completely behind them,” said Bill Tanona, an analyst at Collins Stewart Inc. in New York who rates Citigroup “hold.” “We still have a soft economic environment and - - - - >

JPMorgan Chase & Co., Bank of America Corp. and Citigroup Inc. are approaching managers of leveraged loans to offer terms for new collateralized loan obligations following a record rally this year in the debt, according to people familiar with the discussions who declined to be identified because the talks are private. The highest-rated portions of CLOs have climbed to 89 cents on the dollar from a record low of 69 cents in April, according to Morgan Stanley data.
The $440 billion market for CLOs, which pool loans - - - - >

Oil fell to a two-month low after the greenback advanced on speculation the Federal Reserve will increase borrowing costs next year because of an improving economy. Prices have dropped 11 percent since Dec. 1 on the dollars strength and rising U.S. fuel inventories.
“This move lower has been triggered by whats happened in other markets,” said David Kirsch, an analyst with PFC Energy in Washington, an energy strategist to companies and governments. “Market sentiment has shifted and is now focused on the weak fundamentals.” - - - - >