Congressional Oversight Panel Evaluates Small Banks in the Capital Purchase Program

CPP Served Large Banks Better Than Small Institutions

Many Small Banks May Have Trouble Repaying Treasury

WASHINGTON, D.C. - The Congressional Oversight Panel today released its July oversight report, "Small Banks in the Capital Purchase Program." The Panel found that the result of the Capital Purchase Program's (CPP) "one-size-fits-all" repayment terms has been that large banks have been much better served by the program than smaller institutions. Small banks may find it difficult or impossible to exit the program, particularly if the current distressed financial markets persist.

Treasury provided capital to banks participating in the CPP under a single set of repayment terms designed at the outset of the program. Of the 19 American banks with more than $100 billion in assets, 17 participated in the CPP, receiving 81 percent of the total CPP funds. Money was made available to many of these large banks in only a matter of weeks, in some cases even before the banks applied for the funds. Of these large banks, 76 percent have already repaid taxpayers, and many are now reporting record profits. By contrast, of the 7,891 banks with assets of less than $100 billion, only 690 received funds from CPP and less than 10 percent have repaid. Those banks experienced a longer and more stringent evaluation, and many are now struggling to meet their obligations to the taxpayers.

The Panel identified several concerns:

The "one-size-fits-all" approach suited large banks much better than their smaller counterparts. Small banks do not benefit from any "too big to fail" guarantee; regulators have been quite willing to close down smaller failing institutions. Small banks are disproportionately exposed to commercial real estate, where future losses are likely. Small banks are often privately held or thinly traded and have limited access to capital markets. Despite these differences, the terms for repaying CPP capital are the same for both small and large banks.

Small banks are at risk of becoming stuck in program: unable to raise enough money to repay their CPP investment with many struggling to pay their TARP dividends. Already, one in seven small banks has missed a dividend payment. The problem will grow worse in a few years, when TARP's dividend rate will nearly double from a relatively modest 5 percent to a very expensive 9 percent. This, in combination with other strains from the recession and commercial real estate liabilities, could force some banks to default on their obligations to taxpayers, consolidate, or collapse.

One lasting effect of TARP may be a banking system that becomes more concentrated. In its earliest days CPP provided a capital cushion that helped large banks weather the financial crisis and, in some cases, to purchase smaller banks. Now small banks are struggling and TARP may not be making a difference. For as long as small banks remain weak, small business lending will remain constricted and the economic recovery will struggle to get off the ground.

The Panel recommends that Treasury take immediate steps to ensure that as many banks as possible repay taxpayers and to prepare to deal accordingly with the banks that cannot. In particular, Treasury should work to support CPP banks' efforts to raise new capital, determine options for the illiquid portions of its portfolio, including bundling and pooling investments, and articulate a process for appointing board members for banks that fall too far behind on their dividend payments.

The full report is available at cop.senate.gov.

The Congressional Oversight Panel was created to oversee the expenditure of the Troubled Asset Relief Program (TARP) funds authorized by Congress in the Emergency Economic Stabilization Act of 2008 (EESA) and to provide recommendations on regulatory reform. The Panel members are: J. Mark McWatters; Richard H. Neiman, Superintendent of Banks for the State of New York; Damon Silvers, Policy Director and Special Counsel for the AFL-CIO; Kenneth Troske, William B. Sturgill Professor of Economics at the University of Kentucky; and Elizabeth Warren, Leo Gottlieb Professor of Law at Harvard Law School.

Congressional Oversight Panel to Hold Hearing with Treasury Secretary Timothy Geithner

On Tuesday, June 22, the Congressional Oversight Panel will hold a hearing with Treasury Secretary Timothy Geithner in room 192 of the Dirksen Senate Office Building. Congress created the Congressional Oversight Panel to oversee the $700 billion Troubled Asset Relief Program.

In carrying out its responsibilities under the Emergency Economic Stabilization Act of 2008, the Panel has published 19 monthly reports, two special reports, and held 20 hearings on a wide range of TARP and related financial stabilization initiatives.

WHO:
Members of the TARP Congressional Oversight Panel

WHAT:
Hearing with Treasury Secretary Timothy Geithner

WHEN:
Tuesday, June 22, 2010; 10:00 a.m.

WHERE:
192 Dirksen Senate Office Building

The hearing is open to press and public and will be webcast on the Panel's website at cop.senate.gov. Individuals with disabilities who require an auxiliary aid or service, including closed captioning service for webcast hearings, should contact the Panel's staff at 202-224-9925 at least two business days in advance of the hearing date.

The Congressional Oversight Panel was created to oversee the expenditure of the Troubled Asset Relief Program (TARP) funds authorized by Congress in the Emergency Economic Stabilization Act of 2008 (EESA) and to provide recommendations on regulatory reform. The Panel members are: J. Mark McWatters; Richard H. Neiman, Superintendent of Banks for the State of New York; Damon Silvers, Policy Director and Special Counsel for the AFL-CIO; Kenneth Troske, William B. Sturgill Professor of Economics at the University of Kentucky; and Elizabeth Warren, Leo Gottlieb Professor of Law at Harvard Law School.

Government Failed to Exhaust All Options Before Committing to a Full Taxpayer-Funded Rescue

WASHINGTON, D.C. — The Congressional Oversight Panel today released its June oversight report, “The AIG Rescue, Its Impact on Markets, and the Government’s Exit Strategy.” The Panel found that the Federal Reserve and Treasury failed to exhaust all other options before undertaking their unprecedented, taxpayer-backed rescue of American International Group (AIG) and its creditors. This rescue resulted in extraordinary risk to taxpayers and a fundamental redefinition of the relationship between the government and the country’s most sophisticated financial institutions.

On September 16, 2008, the Federal Reserve Bank of New York (FRBNY), with the full support of Treasury, rescued AIG with an $85 billion, taxpayer-backed Revolving Credit Facility. These funds would later be supplemented by $49.1 billion from Treasury under the Troubled Asset Relief Program (TARP) as well as additional funds from the Federal Reserve, with $133.3 billion outstanding in total. The total government assistance reached $182 billion.

The Panel conducted a comprehensive overview of the AIG transactions based on a review of thousands of documents. Through a series of actions, including the rescue of AIG, the government succeeded in averting a financial collapse, and nothing in this report takes away from that accomplishment. But after reviewing the federal government’s actions leading up to the AIG rescue and the actions of Treasury, the Panel identified several major concerns:

The government failed to exhaust all options before initially committing $85 billion in taxpayer funds.  In previous rescue efforts, the government had placed a high priority on avoiding direct taxpayer liability for the rescue of private businesses. With AIG, the Federal Reserve and Treasury broke new ground by putting US taxpayers on the line for the full cost and risk of rescuing a failing company. The government has repeatedly stated that they faced a “binary choice”: either allow AIG to fail, or rescue the entire institution, including payment in full to all of its business partners. The Panel rejected this reasoning. The government had additional options, such as orchestrating a rescue funded entirely or in part by private parties.  It failed to exhaust these possibilities before committing $85 billion in taxpayer dollars. Earlier and more aggressive efforts to protect taxpayers and maintain market discipline would, if successful, have had an enormous calming effect on the market — and even if ultimately unsuccessful, they would have strengthened the government’s credibility with taxpayers during a time of crisis.  The importance of exhausting all options upfront is even greater given the government’s contention that, once the initial financial commitment was in place, any withdrawal of government support would have led to a catastrophic collapse of market confidence.

The rescue of AIG distorted the marketplace by transforming highly risky derivatives bets into fully guaranteed payment obligations.  In the ordinary course of business, the costs of AIG’s inability to meet its derivative obligations would have been borne entirely by AIG’s shareholders and creditors.  But rather than sharing the pain among AIG’s creditors, the government instead shifted those costs in full onto taxpayers.  The result was the government backed up the entire derivatives market, as if high-profit, high-risk trading deserved the same taxpayer backstop as savings deposits and checking accounts. Every counterparty — from pension funds for retired workers and individual insurance policies, to sophisticated investors and other financial institutions — received exactly the same deal: a complete rescue at taxpayer expense.

Throughout its rescue of AIG, the government failed to address perceived conflicts of interest.  People from the same small group of law firms, investment banks, and regulators appeared in the AIG saga in many roles, switching sides in a matter of minutes.  These entanglements created the perception that the government was quietly helped banking insiders at the expense of accountability and transparency. 

Even at this late stage, it remains unclear whether taxpayers will ever be repaid in full.  AIG and Treasury have provided optimistic assessments of AIG’s value. The Congressional Budget Office, however, currently estimates that taxpayers will lose $36 billion. The uncertainty lies in whether AIG’s remaining business units are will able to generate sufficient new business to create the necessary shareholder value to repay taxpayers in full. The ultimate cost or profit to taxpayers is unknowable, but it is clear that taxpayers remain at risk for severe losses.

The government’s rescue of AIG continues to have a poisonous effect on the marketplace.  Markets have interpreted the government’s willingness to rescue AIG as a sign of a broader implicit guarantee of “too big to fail” firms.  The AIG rescue demonstrated that Treasury and the Federal Reserve would commit taxpayers to pay any price and bear any burden to prevent the collapse of America’s largest financial institutions and to assure repayment to the creditors doing business with them.  So long as this belief continues to hold sway among investors, the worst effects of AIG’s rescue on the marketplace will linger.

The full report is available at cop.senate.gov.

The Congressional Oversight Panel was created to oversee the expenditure of the Troubled Asset Relief Program (TARP) funds authorized by Congress in the Emergency Economic Stabilization Act of 2008 (EESA) and to provide recommendations on regulatory reform.  The Panel members are: J. Mark McWatters; Richard H. Neiman, Superintendent of Banks for the State of New York; Damon Silvers, Policy Director and Special Counsel for the AFL-CIO; Kenneth Troske, William B. Sturgill Professor of Economics at the University of Kentucky; and Elizabeth Warren, Leo Gottlieb Professor of Law at Harvard Law School.

Statement of Chair Elizabeth Warren on Paul Atkins's Resignation and Welcoming Kenneth Troske to the Congressional Oversight Panel

WASHINGTON, D.C. - Congressional Oversight Panel Chair Elizabeth Warren released the following statement thanking former Securities and Exchange Commissioner Paul S. Atkins for his service and welcoming Professor Kenneth Troske to the Panel:

"Paul has provided unique insights and a keen understanding of the financial markets to the Panel's work to bring accountability to the Troubled Asset Relief Program. I am very grateful for his service to the American people and wish him the best.

"It is a pleasure to welcome Kenneth Troske to the Panel, and I look forward to serving with him in the months ahead. As a scholar and economist, Professor Troske will bring an invaluable perspective to the Panel's ongoing oversight efforts."

The Congressional Oversight Panel was created to oversee the expenditure of the Troubled Asset Relief Program (TARP) funds authorized by Congress in the Emergency Economic Stabilization Act of 2008 (EESA) and to provide recommendations on regulatory reform. The Panel members are: J. Mark McWatters; Richard H. Neiman, Superintendent of Banks for the State of New York; Damon Silvers, Policy Director and Special Counsel for the AFL-CIO; Kenneth Troske, William B. Sturgill Professor of Economics at the University of Kentucky; and Elizabeth Warren, Leo Gottlieb Professor of Law at Harvard Law School.

Congressional Oversight Panel to Hold Hearing on TARP and Other Government Assistance for AIG

WASHINGTON, D.C. - On Wednesday, May 26, the Congressional Oversight Panel will hold a hearing in room 342 of the Dirksen Senate Office Building on the financial assistance provided to American International Group, Inc. (AIG) under the Troubled Asset Relief Program (TARP) and other government financial stability programs.

Through a series of coordinated efforts, Treasury and the Federal Reserve have provided over $133 billion related to AIG since September 2008. Under TARP's American International Group, Inc. Investment Program (formally known as the Systemically Significant Failing Institutions Program), the U.S. Treasury Department has preferred stock holdings in AIG with an aggregate liquidation value of approximately $49 billion and currently holds an approximately 79.8 percent stake in the company.

The testimony gathered at this hearing will inform the Panel's June 2010 oversight report by providing a better understanding of AIG's current and future financial stability, the structure and staging of Treasury's and the Federal Reserve's investments, the rationale behind that support, and AIG's prospects to repay the taxpayers' investment.

The Panel is currently scheduled to hear from the following witnesses:

Scott G. Alvarez, General Counsel, Federal Reserve Board of Governors

Thomas C. Baxter, Jr., General Counsel and Executive Vice President of the Legal Group, Federal Reserve Bank of New York

Robert Benmosche, President and Chief Executive Officer, American International Group, Inc.

Martin Bienenstock, Partner and Chair of Business Solutions and Government Department, Dewey & LeBoeuf

Sarah Dahlgren, Executive Vice President, Special Investments Management and AIG Monitoring, Federal Reserve Bank of New York

Michael E. Finn, Northeast Regional Director, Office of Thrift Supervision

Jim Millstein, Chief Restructuring Officer, U.S. Department of Treasury

Michael Moriarty, Deputy Superintendent for Property and Casualty Markets, New York State Insurance Department

Robert Willumstad, Former Chairman and Chief Executive Officer, American International Group, Inc.

Congress created the Congressional Oversight Panel to oversee the $700 billion Troubled Asset Relief Program. In carrying out its responsibilities under the Emergency Economic Stabilization Act of 2008, the Panel has published 18 monthly reports, two special reports, and held 19 hearings on a wide range of TARP and related financial stabilization initiatives.

This hearing will allow the Panel to fulfill its duties under EESA, specifically to report to Congress on "[t]he impact of purchases made under the Act on the financial markets and financial institutions" and "the effectiveness of the program from the standpoint of minimizing long-term costs to the taxpayers and maximizing benefits for taxpayers." Evaluating the public investment in AIG and assessing the status of the repayment of taxpayer funds is a critical component of the Panel's oversight mandate.

WHO:
Members of the TARP Congressional Oversight Panel

WHAT:
Hearing on TARP and other Government Assistance for AIG

WHEN:
Wednesday, May 26, 2010; 10:00 a.m.

WHERE:
342 Dirksen Senate Office Building

The hearing is open to press and public and will be webcast on the Panel's website at cop.senate.gov. Individuals with disabilities who require an auxiliary aid or service, including closed captioning service for webcast hearings, should contact the Panel's staff at 202-224-9925 at least two business days in advance of the hearing date.

The Congressional Oversight Panel was created to oversee the expenditure of the Troubled Asset Relief Program (TARP) funds authorized by Congress in the Emergency Economic Stabilization Act of 2008 (EESA) and to provide recommendations on regulatory reform. The Panel members are: J. Mark McWatters; Richard H. Neiman, Superintendent of Banks for the State of New York; Damon Silvers, Policy Director and Special Counsel for the AFL-CIO; Kenneth Troske, William B. Sturgill Professor of Economics at the University of Kentucky; and Elizabeth Warren, Leo Gottlieb Professor of Law at Harvard Law School.

Congressional Oversight Panel Evaluates TARP's Impact on the Small Business Credit Crunch

WASHINGTON, D.C. - The Congressional Oversight Panel today released its May oversight report, "The Small Business Credit Crunch and the Impact of the TARP." Although the Troubled Asset Relief Program (TARP) has launched several initiatives aimed at restoring general credit availability, the Panel found little evidence that the TARP has spurred small business lending.

The Secretary of the Treasury recently designated small business credit as a primary focuses of the TARP, and he pledged TARP funds "for additional efforts to facilitate small business lending." The Panel found that:

Small business credit remains severely constricted. Data from the Federal Reserve show that lending plummeted during the 2008 financial crisis and remained sharply restricted throughout 2009. Although Wall Street banks had been increasing their share of small business lending over the last decade, between 2008 and 2009 their small business loan portfolios fell by 9 percent, more than double the 4 percent decline in their overall lending portfolios.

TARP has done little to restore stability to the smaller banks that provide the bulk of small business credit. With Wall Street banks pulling back, some small business borrowers looked to community banks to pick up the slack. Many of these banks, however, continue to struggle with their exposure to commercial real estate loans and other liabilities, constraining their ability to lend.

Treasury's new lending program for small banks, even if enacted by Congress, could have only limited success. The proposed Small Business Lending Fund (SBLF) would provide $30 billion in low-cost capital to small and mid-sized banks, along with incentives to increase lending. The SBLF's prospects are far from certain. The program requires legislative approval, and even if Congress acts immediately, the program may not be fully operational for some time. Moreover, banks may shun the program for fear of being stigmatized by its association with the TARP, or banks may wish to avoid taking on SBLF liabilities at a time when their existing assets, such as commercial real estate, remain in jeopardy. To the extent that the lending contraction reflects a shortfall of demand rather than of supply, a supply-side solution like the SBLF may fail to gain traction.

The Panel called on Treasury to consider creative solutions that engage banks, state-based lending consortia, and other market participants, as well as to take active steps to gather more detailed and dependable data on small business lending. The full report is available at cop.senate.gov.

The Congressional Oversight Panel was created to oversee the expenditure of the Troubled Asset Relief Program (TARP) funds authorized by Congress in the Emergency Economic Stabilization Act of 2008 (EESA) and to provide recommendations on regulatory reform. The Panel members are: former Securities and Exchange Commissioner Paul S. Atkins; J. Mark McWatters; Richard H. Neiman, Superintendent of Banks for the State of New York; Damon Silvers, Policy Director and Special Counsel for the AFL-CIO; and Elizabeth Warren, Leo Gottlieb Professor of Law at Harvard Law School.

Congressional Oversight Panel to Hold Phoenix Field Hearing on Small Business Lending

WASHINGTON, D.C. - On Tuesday, April 27, the Congressional Oversight Panel will hold a field hearing in Phoenix to examine the nationwide contraction in bank lending in the wake of the financial crisis, with a particular focus on small business lending. The Panel will hear from local bank officials and small business executives about their perspectives on credit availability and the performance of the Troubled Asset Relief Program.

The Panel is currently scheduled to hear from the following witnesses:

Candace Wiest, President and CEO, West Valley National Bank

Lynne Herndon, City President - Phoenix, BBVA Compass Bank

James Lundy, President and CEO, Alliance Bank of Arizona

Mary Darling, CEO, Darling Environmental and Surveying, Inc.

Cindy Anderson, CEO, Great Biz Plans

Robert J. Blaney, District Director for Arizona, Small Business Administration

Congress created the Congressional Oversight Panel to oversee the $700 billion Troubled Asset Relief Program (TARP). Through 17 monthly oversight reports, two special reports, and 18 hearings, the Panel has overseen Treasury's administration of TARP and assessed the program's impact on the financial markets, the economic recovery, and the ultimate return to taxpayers.

By visiting Phoenix, the Panel will hear directly from a community that has been deeply affected by the financial crisis and where small businesses continue to struggle to gain access to credit. Between 2000 and 2008, Arizona had the second-fastest-growing population and the fourth-fastest-growing job market in the country. But the state was particularly hard hit by the housing crisis, and its unemployment rate has more than doubled since the 2007 peak of the housing boom, hitting 9.6 percent in March 2010.

Strengthening credit access for small businesses will be important to reviving Arizona's economy. According to the Bureau of the Census, businesses with fewer than 500 employees account for 97.4 percent of the state's employers and 48.8 percent of its private employment.

This hearing will inform the Panel's May oversight report on small business lending.

WHO:
Members of the TARP Congressional Oversight Panel

WHAT:
Field Hearing on Small Business Lending

WHEN:
Tuesday, April 27, 2010; 10:00 a.m. MST (1:00 p.m. EDT)

WHERE:
UA-ASU College of Medicine - Phoenix
Virginia Piper Auditorium
600 East Van Buren Street (Building 2)
Phoenix, Arizona

The hearing is open to press and public and will be webcast live at cop.senate.gov. Individuals with disabilities who require an auxiliary aid or service, including closed captioning service for webcast hearings, should contact the Panel's staff at 202-224-9925 at least two business days in advance of the hearing date.

The Congressional Oversight Panel was created to oversee the expenditure of the Troubled Asset Relief Program (TARP) funds authorized by Congress in the Emergency Economic Stabilization Act of 2008 (EESA) and to provide recommendations on regulatory reform. The Panel members are: former Securities and Exchange Commissioner Paul S. Atkins; J. Mark McWatters; Richard H. Neiman, Superintendent of Banks for the State of New York; Damon Silvers, Policy Director and Special Counsel for the AFL-CIO; and Elizabeth Warren, Leo Gottlieb Professor of Law at Harvard Law School.

Congressional Oversight Panel Evaluates Progress of TARP Foreclosure Mitigation Programs

Panel Applauds Recent HAMP Revisions, But Treasury's Programs Are Not Keeping Pace with the Foreclosure Crisis

WASHINGTON, D.C. - The Congressional Oversight Panel today released its April oversight report, "Evaluating Progress of TARP Foreclosure Mitigation Programs." The Panel commended recent changes to the mortgage modification program designed to reach more homeowners, but found that Treasury is still struggling to get its foreclosure programs off the ground even as the crisis continues unabated.

Since the Panel's last examination of foreclosure mitigation efforts in October 2009, Treasury has taken steps to address concerns that the Home Affordable Modification Program (HAMP) did not adequately address foreclosures caused by unemployment or negative equity, including by establishing a voluntary principal reduction program. Despite these and other efforts, foreclosures continue at a rapid pace. In 2009, 2.8 million homeowners received a foreclosure notice, and nearly one in four homeowners with a mortgage currently has negative equity. While housing prices have begun to stabilize in many regions, home values in several metropolitan areas continue to fall sharply.

The Panel found that "Treasury's response continues to lag well behind the pace of the crisis" and that, even when HAMP is fully operational, they "will not reach the overwhelming majority of homeowners in trouble." The report raises three specific concerns with Treasury's foreclosure programs:

Timeliness. Since early 2009, Treasury has initiated half a dozen foreclosure mitigation programs, gradually ramping up the incentives for participation by borrowers, lenders, and servicers. Although Treasury should be commended for trying new approaches, its pattern of providing ever more generous incentives might backfire, as lenders and servicers might opt to delay modifications in hopes of eventually receiving a better deal.

Sustainability. Although HAMP modifications reduce a homeowner's mortgage payments, many borrowers continue to experience severe financial strain. HAMP typically does not reduce the total principal balance of a mortgage, meaning that a borrower who was underwater before receiving a HAMP modification will likely remain underwater afterward. Many borrowers will eventually redefault and face foreclosure. Redefaults signal the worst form of failure of the HAMP program: billions of taxpayer dollars will have been spent to delay rather than prevent foreclosures.

Accountability. The Panel is concerned that the sum total of announced funding for Treasury's individual foreclosure programs exceeds the total amount set aside for foreclosure prevention. Treasury must be clearer about how much taxpayer money it intends to spend. Additionally, it must thoroughly monitor the activities of participating lenders and servicers, audit them, and enforce program rules with strong penalties for failure to follow the requirements.

The full report is available at cop.senate.gov.

The Congressional Oversight Panel was created to oversee the expenditure of the Troubled Asset Relief Program (TARP) funds authorized by Congress in the Emergency Economic Stabilization Act of 2008 (EESA) and to provide recommendations on regulatory reform. The Panel members are: former Securities and Exchange Commissioner Paul S. Atkins; J. Mark McWatters; Richard H. Neiman, Superintendent of Banks for the State of New York; Damon Silvers, Policy Director and Special Counsel for the AFL-CIO; and Elizabeth Warren, Leo Gottlieb Professor of Law at Harvard Law School.

Congressional Oversight Panel Hearing on Citigroup Assistance Under TARP

WASHINGTON, D.C. - On Thursday, March 4, 2010, the Congressional Oversight Panel will hold a hearing in room 538 of Dirksen Senate Office Building about the government's assistance to Citigroup under the Troubled Asset Relief Program (TARP). Assistant Treasury Secretary Herbert M. Allison, Jr. and Citigroup Chief Executive Officer Vikram Pandit are scheduled to testify.

Over the course of the financial crisis Citigroup received $45 billion in TARP funding, including $20 billion through the Targeted Investment Program (TIP) and $25 billion through the Capital Purchase Program (CPP), as well as a government guarantee of a pool of approximately $301 billion in assets. Citigroup announced on December 23, 2009 that it had completed repaying its $20 billion in TIP assistance and had terminated its asset guarantee. Treasury continues to own approximately 7.7 billion shares of Citigroup common stock - approximately 27 percent of Citigroup's outstanding common stock - as a consequence of CPP assistance.

WHO:
Members of the TARP Congressional Oversight Panel

Witnesses:

Panel One:
Herbert M. Allison, Assistant Treasury Secretary for Financial Stability

Panel Two:
Vikram Pandit, Chief Executive Officer, Citigroup

WHAT:
Hearing on Assistance Provided to Citigroup Under TARP

WHEN:
Thursday, March 4, 2010; 10:00 a.m.

WHERE:
538 Dirksen Senate Office Building

Congress created the Congressional Oversight Panel to oversee the $700 billion Troubled Asset Relief Program. In carrying out its responsibilities under the Emergency Economic Stabilization Act of 2008, the Panel has published 15 monthly reports and two special reports, and held 17 hearings on a wide range of TARP and related financial stabilization initiatives.

This hearing will provide a better understanding of the Administration's financial stabilization efforts and the impact of TARP assistance on Citigroup. It is open to press and the public and will be webcast on the Panel's website at cop.senate.gov.

Individuals with disabilities who require an auxiliary aid or service, including closed captioning service for webcast hearings, should contact the Panel's staff at 202-224-9925 at least two business days in advance of the hearing date.

The Congressional Oversight Panel was created to oversee the expenditure of the Troubled Asset Relief Program (TARP) funds authorized by Congress in the Emergency Economic Stabilization Act of 2008 (EESA) and to provide recommendations on regulatory reform. The Panel members are: former Securities and Exchange Commissioner Paul S. Atkins; J. Mark McWatters; Richard H. Neiman, Superintendent of Banks for the State of New York; Damon Silvers, Policy Director and Special Counsel for the AFL-CIO; and Elizabeth Warren, Leo Gottlieb Professor of Law at Harvard Law School.

COP Hearing on GMAC Financial Services

WASHINGTON, D.C. - On Thursday, February 25, the Congressional Oversight Panel will hold a hearing in room 342 of the Dirksen Senate Office Building about the government's assistance to GMAC under the Troubled Asset Relief Program (TARP) and the government's broader financial stability efforts. The government spent $17.2 billion in support of GMAC and now owns a 56.3 percent stake in the company.

The Panel will hear from the U.S. Department of Treasury, GMAC Financial Services, and industry analysts about their perspectives on GMAC's current and future financial stability, the structure and staging of Treasury's investments in GMAC, the rationale behind that support, and GMAC's strategic initiatives and plans to repay the taxpayers' investment.

The Panel is scheduled to hear from the following witnesses:

Panel One

Ron Bloom, Senior Advisor to the Secretary of the Treasury
Jim Millstein, Chief Restructuring Officer, U.S. Department of Treasury

Panel Two

Michael Carpenter, Chief Executive Officer, GMAC Financial Services
Robert Hull, Chief Financial Officer, GMAC Financial Services

Panel Three

Christopher Whalen, Senior Vice President and Managing Director, Institutional Risk Analytics
Michael Ward, Analyst, Soleil-Ward Transportation Research

Congress created the Congressional Oversight Panel to oversee the $700 billion Troubled Asset Relief Program. In carrying out its responsibilities under the Emergency Economic Stabilization Act of 2008, the Panel has published 15 monthly reports and two special reports, and held 16 hearings on a wide range of TARP and related financial stabilization initiatives.

This hearing will provide a better understanding of the Administration's financial stabilization efforts and the impact of TARP assistance on GMAC Financial Services, and it will inform the Panel's March oversight report.

WHO:
Members of the TARP Congressional Oversight Panel

WHAT:
Hearing on Assistance Provided to GMAC Under TARP

WHEN:
Thursday, February 25, 2010; 10:00 a.m.

WHERE:
342 Dirksen Senate Office Building

The hearing is open to press and public and will be webcast on our website at cop.senate.gov. Individuals with disabilities who require an auxiliary aid or service, including closed captioning service for webcast hearings, should contact the Panel's staff at 202-224-9925 at least two business days in advance of the hearing date.

The Congressional Oversight Panel was created to oversee the expenditure of the Troubled Asset Relief Program (TARP) funds authorized by Congress in the Emergency Economic Stabilization Act of 2008 (EESA) and to provide recommendations on regulatory reform. The Panel members are: former Securities and Exchange Commissioner Paul S. Atkins; J. Mark McWatters; Richard H. Neiman, Superintendent of Banks for the State of New York; Damon Silvers, Policy Director and Special Counsel for the AFL-CIO; and Elizabeth Warren, Leo Gottlieb Professor of Law at Harvard Law School.