The grilling of the country's eight biggest bank CEOs this morning promises to be juicy, so BankThink is live-blogging on the event. Stay tuned for the hearing´s every barb and twist.
The witnesses are: Lloyd C. Blankfein, Chief Executive Officer and Chairman, Goldman Sachs & Co.; James Dimon, Chief Executive Officer, JPMorgan Chase & Co.; Robert P. Kelly, Chairman and Chief Executive Officer, Bank of New York Mellon; Ken Lewis, Chairman and Chief Executive Officer, Bank of America; Ronald E. Logue, Chairman and Chief Executive Officer, State Street Corporation; John J. Mack, Chairman and Chief Executive Officer, Morgan Stanley; Vikram Pandit, Chief Executive Officer, Citigroup; John Stumpf, President and Chief Executive Officer, Wells Fargo & Co.
10:03am: Chairman Barney Frank warns against interruptions like shouts and laughter.
10:10am: Frank: "I urge you strongly to cooperate with us...not grudgingly..."
10:11am: Rep. Spencer Bachus, R-Ala.: "We in Congress have screwed up pretty badly...now we're turning our attention to you. May God help us and all of the American people as we do that."
10:15am: Rep. Frank is rigidly enforcing the time limits the committee members have to speak.
10:16am: Rep. Paul Kanjorski, D-Penn., tells the CEOs to explain why they needed the money and adds to those who have decided they don't want it, "Please find a way to return that money before you leave town."
10:19am: Rep. Jeb Hensarling, R-Tx., just cut himself off in mid-sentence as his time ran out, adding to the tension between the absurdity of the hearing and the sober vigour with which Rep. Frank is approaching it. The crowd giggled, clearly hungry for a good show.
10:25am: Committee members are playing their opening statements pretty straight--did the banks lend some of the money they received? Did they use it to stabilize themselves? Were they responsible? So far, few have added much vitriol to their remarks.
10:27am: Rep. Lynn Jenkins, R-Ks. "My constituents in Kansas sent me to Washington with a clear mandate to protect the dollars they send to the government."
10:29am: The CEOs have begun making their opening statements. Mr. Blankfein is first. "Wall Street lost sight of its public obligation," he's saying.
10:33am: Goldman Sachs has never had golden parachutes?
10:35am: Mr. Dimon: "JPMorgan is lending."
10:38am: "All of us who are here and many who are not here bear the responsibility" for the financial crisis, Mr. Dimon says. This is the closest thing to mea culpa so far. Blankfein didn't go near it.
10:40am: Mr. Kelly: "The $3 billion in capital that we received from Treasury allowed us to do quite a bit more in getting capital moving in the financial markets." He actually followed that up by breaking down its allocation.
10:43am: Mr. Lewis has begun, with his Southern drawl, by reassuring the committee that "it is in all of our interests that banks lend."
10:47am: Mr. Lewis: "We bankers should find some humility" in connecting "people who make things and people who use them."
10:51am: The CEOs, too, are sticking to their time limits. Looks like they don't want to luxuriate in the spotlight. Morgan Stanley's Mr. Mack: "As head of the firm, I take responsibility for our performance." A little higher on the apology meter.
10:54am: "We have not used it to pay compensation, dividends or any lobbying costs," Mr. Mack said of the Tarp infusion. By the way, he hasn't taken a bonus since 2006. Applause, anyone?
10:56am: Mr. Pandit: "I am Virkam Pandit, chief executive of Citigroup." It must have taken some courage to admit that.
10:57am: The retail bank CEOs have all emphasized the success of their voluntary loan mod programs. Prediction: Frank will "correct" them on that later.
11:00am: WOW Pandit just apologized for "not adjusting to the new reality quickly enough," i.e. ording a new corporate jet. So far, he gets the candor award. Also, he proposes a $1 a year salary.
11:02am: Mr. Stumpf: "We have never been wasteful." That is the opposite of an apology.
11:09am: The questions are starting--time to jump to a new post! Follow me from the BankThink home page.