Citigroup (C), JP Morgan Chase (JPM), Wells Fargo (WFC) and Others to Lose FDIC Debt Guarantees

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As of October 14th, 2009, the FDIC had $309.4 billion in outstanding debt-guarantees. http://www.americanbankingnews.com/2009/10/20/citigroup-c-jp-morgan-chase-jpm-wells-fargo-wfc-and-others-to-lose-fdic-debt-guarantees/ Citigroup ©, JP Morgan Chase (JPM), Wells Fargo (WFC) and Others to Lose FDIC Debt GuaranteesOctober 20th, 2009 Filed Under: Industry News Some of the nation’s largest financial companies, including Citigroup (NYSE: C), GE Capital (NYSE: GE), JPMorgan Chase (NYSE: JPM), Wells Fargo (NYSE: WFC), Bank of America (NYSE: BAC) and others will no longer have certain debt guaranteed by the federal government through the FDIC’s Temporary Liquidity Guarantee Program as of October 31st.The FDIC voted on Tuesday to end the Temporary Liquidity Guarantee Program that is being used to guarantee certain debt issued by some of the nation’s largest banks, but also setup a 6-month safety net facility as part of the process. All five members of the FDIC’s panel of regulators voted to end the program as scheduled on October 31st.New debt can be issued and guaranteed under the program up until the deadline. The deadline on the newly placed debt would expire no later than December 31st, 2012.FDIC Chairman, Sheila Bair, stated, “It should be clear that this is not a continuation of the program but an ending of the program.”The program does leave open a 6-month safety-net feature for banks suffering from “market disruptions” beyond their control. Under the transitional facility, banks can have new debt guaranteed through April 30th, 2010 if the FDIC approves the guarantee.During the month of September, the FDIC requested public comment about two different approaches to ending the program. One of the programs would let the program finish by the end of the month and the other would include a 6-month guarantee facility for some banks on a case-by-case basis.The FDIC established the Temporary Liquidity Guarantee Program last October in order to boost confidence in the banking industry, add more liquidity, and reduce the possibility of bank runs. The TLGP program places a government guarantee on some senior unsecured debt and mandatory convertible debt, as well as on banks’ transaction deposit accounts.Regulators are hoping to phase out the program now that stress on the credit market has eased. FDIC officials are also want to avoid promoting reliance on government aid by the financial industry.As of October 14th, 2009, the FDIC had $309.4 billion in outstanding debt-guarantees.«¤»¥«¤»§«¤»¥«¤»§«¤»¥«¤»§«¤»¥«¤»§«¤»¥«¤»§«¤»¥«¤«¤»¥«¤»§«¤»¥«¤»§«¤»¥«¤»§«¤»¥«¤»Paranormal_Research - Scientific Data, Health Conspiracies & Anything Strange Paranormal_ResearchSubscribe:... Paranormal_Research-