Panel of 5 Picks Bailout Winners, Losers

The committee members study financial statements and sometimes kick back applications to the regulators for more information. They also analyze the market in which a bank operates, looking for the mix of strong and weak banks. As the number of applications increases, Mr. Lambright said he was recruiting a team of banking analysts to help with the process.

“When we move from a dozen banks to hundreds of banks, we’ll need a system,” Mr. Lambright said.

He said his work at the Export-Import Bank, where he selected American exporters to receive trade financing, was good preparation for this job, even if he will hand out more money in a few weeks at the Treasury than his bank’s entire $60 billion credit portfolio.

Though Treasury officials are loath to require banks to lend, they do seem to be jawboning. “They must meet their responsibility to lend, and support the American people and the U.S. economy,” Mr. Ryan told a securities industry conference last week.

Mr. Frank said they should do more by requiring banks to show a dollar-for-dollar relationship between the government funds and increased lending.

“If they lend out all the money they got from the government,” he said, “they can do whatever they want with the rest. If they don’t feel this is going to encourage lending, then don’t take the money.”

It is the regulators, more than the Treasury Department, who are doing the coaxing by suggesting, for example, that a desired merger by a bank would be more likely to win approval if a bank participated in the capital injection program, industry executives said.

The Treasury’s approach has its defenders, among them a former senior Treasury official, Edwin M. Truman, who said he believed the people running the bailout were technocrats trying to shore up the system, not ideologues.

Donald V. Hammond, a longtime Treasury official who is the interim chief compliance officer of the program, said that, in any event, Congress had put in place layers of oversight. Mr. Hammond began his government career working on the bailout of the Chrysler Corporation.

“This is more intense,” he said.

This story originally appeared in The New York Times

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