Banks, Bank Bailout | featured news

Fannie Mae earned $17.2 billion last year, the biggest annual profit in the U.S. mortgage giant's history, helped by a record fourth quarter.

Insurer AIG says it will not join a $25bn (£16bn) lawsuit against the US government, which alleges that the terms of its rescue deal were unfair.

A lawsuit claims that the rescue by the government deprived A.I.G.'s shareholders of tens of billions of dollars and took private property for public use without appropriate compensation.

The Treasury said on Friday it is changing the way Fannie Mae and Freddie Mac will repay taxpayers in a move the Obama administration said would accelerate the winding down of the government-owned mortgage financiers.

Small banks still owe $11 billion of taxpayer money under TARP, and the government is threatening to unload its stakes in them at big discounts to new investors. Nearly four years after Washington bailed out Wall Street, small banks have yet to repay $11 billion of taxpayer money.

Bank of America NA prevented homeowners from receiving mortgage-loan modifications under a federal program in order to avoid millions of dollars in losses while benefitting from financial incentives for participating in the program, according to a complaint unsealed in federal court Wednesday.

Bank of America made $2 billion in the last three months of last year, reversing a loss from a year earlier. It offset legal expenses over mortgages and losses in its investment...

Banks earned $13 billion in secret cut-rate loans from the Federal Reserve during the financial crisis, Bloomberg reports... "Many Americans are struggling to understand why banks deserve such preferential treatment while millions of homeowners are being denied assistance and are at increasing risk of foreclosure," Cummings wrote in his letter.

Freddie Mac's chief executive, Charles E. "Ed" Haldeman Jr., will step down by the end of the year, the regulator of the company said on Wednesday.

The leaders of Germany and France, the eurozone's two biggest economies, say they have reached agreement on strengthening Europe's shaky banking sector.