Bank of America says it's paying back $45 billion in government loans - CharlotteObserver.com
Bank of America said Wednesday evening it is set to repay all of its $45 billion in government aid, a step that helps remove the stigma of being a bailout recipient and dials back government scrutiny of its operations.
The Charlotte bank had been eager to pay back the money for months, but it needed the approval of government regulators. The move allows departing chief executive Ken Lewis to remove a major blot on his legacy, and it potentially makes it easier for the company to find his replacement.
The U.S. Treasury said the repayment means Bank of America will be freed from executive compensation restrictions imposed by pay czar Ken Feinberg, which have made it tougher to attract a new CEO. Feinberg also will have no say on the final total compensation and pension for Lewis.
Bank of America said Wednesday evening it is set to repay all of its $45 billion in government aid, a step that helps remove the stigma of being a bailout recipient and dials back government scrutiny of its operations.
The Charlotte bank had been eager to pay back the money for months, but it needed the approval of government regulators. The move allows departing chief executive Ken Lewis to remove a major blot on his legacy, and it potentially makes it easier for the company to find his replacement.
The U.S. Treasury said the repayment means Bank of America will be freed from executive compensation restrictions imposed by pay czar Ken Feinberg, which have made it tougher to attract a new CEO. Feinberg also will have no say on the final total compensation and pension for Lewis.
Czar Ken Feinberg puts ball and chain on business CEO's
No one wants the banks CEO's job with czar Ken Feinberg restrictions on the CEO's pay. With Lewis leaving at year's end, and why should he stay with the little CEO's pay, Bank of America needs to remove those restrictions. The bank received approval to return the TARP money after negotiations with regulators heated up in recent weeks. Chief risk officer Greg Curl, who is considered an internal CEO candidate, spearheaded the talks.
Kenneth Feinberg, the U.S. paymaster for rescued companies, will exempt some executives at American
International Group Inc. from a $500,000 salary cap after at least five employees threatened to quit because of the limits, people familiar with the matter said.
Feinberg may issue a ruling as early as next week on pay limits for 75 of the bailed-out insurer’s executives, the people said. Last week, five executives said they were prepared to resign if their compensation was significantly cut.
The compensation ruling could mean that some AIG executives among the 75 may earn bigger salaries than those in a group that Feinberg ruled on six weeks ago, who were previously the highest-paid employees. The $500,000 limit has so far applied to everyone at New York-based AIG except Chief Executive Officer Robert Benmosche, who has a $7 million salary.
American International Group Inc. Chief Executive Officer Robert Benmosche told the company’s
board that he is considering resigning from the job he’s held for three months, the Wall Street Journal reported, citing people familiar with the situation.
The CEO is chafing under constraints imposed by AIG’s government overseers, in particular a recent compensation review by Kenneth Feinberg, the special master on pay in U.S. PresidentBarack Obama’s administration, according to the people.
Benmosche, who started in August after his predecessor Edward Liddy quit in May, is seeking to halt the departure of customers and employees so he can build up units to sell in order to repay loans included in AIG’s $182.3 billion bailout. New York-based AIG is among firms Feinberg ordered to slash pay.
U.S. President Barack Obama’s administration will destroy our banking business!
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