Bank CEOs who received federal bailout money will be grilled on Capitol Hill today about how they put their TARP money to use, and Barney Frank, chairman of the House Financial Services Committee, will be running the show. He told CNBC the past mistakes of the financial services industry must be avoided.
"What the people who we are going to be talking to in the witness chairs today have to understand is, their past behavior has so angered the average American that our ability to move forward is somewhat jeopardized," he said. "...They have to acknowledge their past mistakes as part of assuring people that if we go forward with the second half of this $700 billion, if we follow through on the kind of things Secertary Geithner was talking about, that we won't get a repeat."
Frank, D-Mass., says the goal of today's hearing is to figure out what to do going forward, so that the credit system will be fully functioning again.
"What we will do now, I hope, under Secretary Geithner is to say here is new money, and we expect a great bulk of that to be relent," he told CNBC. "Yes we will be also be working simultaneiously on the toxic assets, but if they get new capital, that's in addition to what they already have, that should be generating additional lending otherwise it shouldn't be given."
Frank added that if unhappy banks want to pay back the TARP money sooner, he's fine with that.
Lloyd Blankfein, of Goldman Sachs , James Dimon, of JPMorgan Chase , Robert Kelly, of Bank of New York Mellon , Ken Lewis, of Bank of America , Ronald Logue, of State Street Corporation , John Mack, of Morgan Stanley , Vikram Pandit, of Citigroup , and John Stumpf, of Wells Fargo , will all appear before the House Financial Services Committee for questioning.
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