White House to Banks: Make More Loans

The AP reported today that the White House is pressing banks who’ve received Treasury funds to stop hoarding it and start lending it. Under the Troubled Asset Relief Plan (TARP), Treasury has given out about $150b of $250b to about 24 banks—here’s the latest list of banks and amounts. So far not much of that money has been re-deployed as Treasury Secretary Henry Paulson called for when the plan was rolled out in mid-October.

White House press secretary Dana Perino told reporters Tuesday that the Bush administration is trying to “get banks to do what they are supposed to do,” which is lend money. Though there are limits on how much Washington can pressure financial firms, she noted that banks are regulated by the federal government.

Perino said that the administration is watching lending activity very closely and working with the banks to step it up. She said that Anthony Ryan, Treasury’s acting undersecretary for domestic finance, was delivering a speech in New York on Tuesday that made this point.