Treasury Considering More Citigroup-Style Rescue Packages

WASHINGTON — The Treasury Department opened the door Friday to using a Citigroup-style rescue package to help other troubled financial institutions.

The financial lifeline thrown to Citigroup Inc. in late November involved backing billions in risky assets and providing the banking giant with a fresh capital infusion.

Treasury said participation by other companies in such a program would be weighed on a case-by-case basis. Treasury said it would consider, among other things, whether the "destabilization" of a financial institution could threaten the viability of creditors and others. It also would weigh the extent to which the institution faced a loss of confidence because of the troubled assets it held.

The information was contained in guidelines for the initiative, dubbed the Targeted Investment Program, unveiled on Friday.

Separately, a new program that provides government backing for a financial institution's potential losses from risky assets will be used sparingly, the department said. Congress required that the insurance program be created as part of the $700 billion financial bailout package enacted in October.

"This program will be applied with extreme discretion in order to improve market confidence in the systemically significant institution and in financial markets broadly," the department said. "It is not anticipated that the program will be made widely available."

The department said it is exploring using the program to address guarantee provisions that were part of the Citigroup rescue package. The program provides guarantees for troubled assets held by a financial institution that would otherwise risk a loss of market confidence.

Treasury said it would determine eligibility for the program on a case-by-case basis. In accordance with the law, any assets to be guaranteed must have been originated before March, 14, 2008.

Comments

[tomas0808]

Let em keep bailing them out. It's not gonna do any good. They're still gonna fail. Enough of the masses are so fed up with these liars and thieves that they are gonna sacrifice buying junk, pay off their credit cards and be extra vigilant about overdrafts and the like. They have totally blown our trust and given the extent of the scandals I don't see it ever going back to the way it was. Same thing with advertisers. Enough people are finally waking up to the fact that they are liars and they don't need their garbage

[solarian]

no more bail outs. you are a business it sink or swim, you are on your own

[americaforme]

Seems to me that Banks should bow out, on bail outs, since they are exposed to the American people as thiefs. The treasury should think about the moneys that Banks make in just over drafts, through the year. I read that banks made 17 billion last year in over drafts alone. We are in serious trouble when payday loans are cheaper than overdrafts. no Bailouts!

[ForRichardorPoorer]

The Robber Barron(s) of the 21st century,,,,
Take control of the corporate/industrial complex, lobby and purchase congress.

[blueskybigstar]

Giving the money lenders money is like trying to make fix a pothole by digging it into a ditch. Traffic will not run more smoothly. The money needs to go to the real economy and not to the parasites who would like for you to believe that they are needed. They don't produce anything. The government would have done a better job.

[loki]

yes, why not. Because they know that those sports stadiums need hundreds of millions in tax payer money to have company names plastered all over them, and the upper management can not continue to survive without huge bonus checks and the millions in company perks.

[redhot200822]

Here's the term sheet for any entity that uses TARP funds.

http://www.treas.gov/press/releases/reports/termsheet.pdf

[redhot200822]

Americans are making 8% off Citi

http://money.cnn.com/quote/sec/sec.filings.html?symb=C&sequenceid=1&guid=6275191

[loki]

wonder if we will be taxed on that?

[redhot200822]

The timer just went off. Pull up the fries before they burn.

[blueskybigstar]

Citi is making 100% off our backs. Tell me what entitles banks to act like parasites?

[redhot200822]

Nothing says you have to use a bank.

[cayuse]

Google "REIT Timber Companies", "MOB" and you will realize the plan to create a feudalistic society here and abroad is sound. They are not just greedy, the are very clever.

A journey of 1000 miles begins with the first step. Turn the ship in the right direction, use keynesian economics, arrest the crooks when they are out of office and cannot pardon themselves. But we may have to clean house in congress too

[blueskybigstar]

I don't dismiss you.

[LaReina]

And why not, the entire congress is on the Dole of Wall Street, thanks fot stupid taxpayers like us?

[Mildmannered]

I want to thank Bush and his financial team including Cox, Paulson and Bernanke for their total incompetence which has brought me, my family and at least tens of millions of Americans considerable economic pain.

Don't worry, Mr. Bush, your legacy is secure.

[crablover]

These creeps just raised my maste card interest rate from 8.9 to 13.9% for NO REASON! To h**l with all of them!

[Mildmannered]

It is because the Federal Reserve dropped the federal funds rate to 0.25%.

[Tom95134]

Expect these additional "Rescue Packages" all to happen before January 20th. Bush has to pay off his obligation to the haves and have mores before he is ushered out the door.

[olephart]

Wouldn"t it be easier to just supply the financial institutions with the plates and presses used by the Bureau of Engraving and Printing and let them just print whatever they need? The Fed and the Treasury have already ignored the calls for transparency in their dealings with these institutions. Since the money has no strings and no accountabilities why bother with the formalities of handing it over?

[mjb5406]

We can't dump Paulson fast enough!

[KCFreedom]

Where is THAT money all coming from?

Are the taxpayers going to pay interest to the federal reserve for that? Yes.

We're getting scammed coming and going. And these corporations will take it from us after we bail them out.

[Tom95134]

Don't you hear that noise in the background? It's the printing presses at the U.S. Treasury running at top speed per order of George W. Bush. When this is done we'll be lucky if the U.S. Currency doesn't end up looking (or treated) like Monopoly money with a picture of Bush on it.

[KCFreedom]

At this point, I don't think even Milton-Bradley would put George's mug on Monopoly money.

Speaking of Monopoly games, they're all made in China now. We can't even make a Monopoly board in this country. All that technology, gone :>(.