Wednesday, October 29, 2008

"Barclays non-governmental recapitalisation efforts don’t exactly appear to be thundering forward."

Interesting post on Alphaville about banks not taking bailout money and how they're doing in getting investment:

"To bailout or not to bailout…

Barclays non-governmental recapitalisation efforts don’t exactly appear to be thundering forward. In the US, meanwhile, as observed by footnoted, banks’ are exhibiting some peculiarly similar recap-PR lines:

NorthernTrust put out a press release yesterday to announce its $1.5 billion infusion because it “fully supports the U.S. government’s efforts to strengthen our nation’s financial system.” There’s also this one from Valley National: “Although Valley is a well-capitalized organization, we believe such a program provides an excellent opportunity for healthy strong banks like Valley to participate in and support the recovery of the U.S. economy”. Even relatively small banks seem to be on message, like First Niagara which said in its press release yesterday, “We are supportive of the Treasury Department’s efforts and remain strongly committed to supporting the economy in Upstate New York.”

Banks’ boards, indeed, face quite a tough call when it comes to using government money. The below has been sent to us from Hilary Winter - a partner at Orrick:"

Do read the whole post.

Here's my comment:

Posted by Don the libertarian Democrat [report]

Maybe the banks that don’t take money from the government should say something like the following:

” We conducted our business in such a way as to not need government money, and are even getting private money in this environment, showing how much we are trusted. And, hey, we won’t lose the taxpayers a lot of money. So invest in us: Don’s Bank: I don’t need no stinking bailout!

I wonder how Casey Mulligan feels about this story?

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