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Obama announces squeeze on bailed-out banks.

Summary: US President Barack Obama has announced plans to make Wall Street banks pay back $117 billion to taxpayers for the financial bailout.

US President Barack Obama has announced plans to make Wall Street banks pay back $117 billion to taxpayers for the financial bailout.

The fee, which Mr Obama will formally propose in his fiscal year 2011 budget to be released in February, will recoup losses from the rescue of US banks called the Troubled Asset Relief Program or Tarp.

Forged after the collapse of Lehman Brothers and multibillion-dollar rescue of insurance giant AIG, Tarp helped stem the crisis by injecting public capital into the biggest banks.

The administration said it was needed to avert a catastrophe in the broader economy, but it did not prevent the US from sliding into a recession that has pushed unemployment to a 26-year high of ten per cent.

Wall Street has rebounded recently, raking in bumper profits that have helped banks repay bailout bonds and freed them to pay out massive staff bonuses once more.

Mr Obama said: "My determination to achieve this goal is only heightened when I see reports of massive profits and obscene bonuses at some of the very firms who owe their continued existence to the American people."

Independent Television News Limited 2010. All rights reserved.

Independent Television News Limited 2009. All rights reserved.

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Publication:Independent Television News Limited (ITN)
Date:Jan 20, 2010
Words:234
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