Banks | featured news

The U.S. Treasury Department is likely to unveil as soon as next week a three-part plan to relieve the U.S. financial system of the toxic assets that have been clogging up the banks' balance sheets, a source familiar with the plan said on Saturday.

Fallout from anger over AIG's bonuses is following Sen. Chris Dodd from Washington back home to Connecticut.

An alarmed industry tells Congress, White House that severe pay restrictions would punish many for the sins of a few and hurt broader economy.

Citigroup Inc named Chief Financial Officer Gary Crittenden as chairman of troubled banking unit Citi Holdings on Friday, and elevated Edward Kelly to replace him as CFO.

Democrats and Republicans tried to outdo one another in voicing indignation as the House debated a bill to punish A.I.G. executives who got big bonuses.

President Obama said Wednesday that no one in his administration had been responsible for supervising ailing insurance giant AIG but that ultimately, the buck stops with him.

Bank of America Corp and Citigroup Inc shares have roughly tripled from multi-decade lows set less than a month ago, and powered higher on Wednesday on speculation their recent punishing declines might have been too severe.

Fannie Mae is due to pay retention bonuses of as much $470,000 to $611,000 this year to some executives despite enormous losses. Freddie Mac also plans to pay such bonuses but hasn't yet provided details.

The chief executive officer of failed insurance conglomerate AIG acknowledged Wednesday that the company's multimillion-dollar bonuses were "distasteful" to many and had provoked a firestorm of wrath.

White House Press Secretary Robert Gibbs is not a lawyer, nor does he play one on TV. So when just about every question at Tuesday's afternoon briefing concerned bonuses at insurance giant AIG, Gibbs had a non-answer at the ready. "I'm not a contracts lawyer," he said at one point, later explaining that he was "not a contract lawyer," either. When asked whether the president could simply deny more money to AIG unless it scrapped bonuses, he repeated: "Again, I'd refer you to a contract lawyer, which I'm not one."