Banks, Bailouts | featured news

American International Group Inc is close to a deal with the U.S. government that would ease the terms of its bailout, provide a further equity commitment and help it pay down debt, a person familiar with the matter said on Saturday.

Wall Street is down sharply lower as investors second-guess Citigroup Inc.'s plans to turn over a big piece of itself to the government.

The New York Attorney General's office has subpoenaed Bank of America to submit a list of employees who got bonuses and the amounts that the employees received, a spokesman for the New York Attorney General said on Thursday.

Loss included $25.2B in fourth quarter, prompting a government cash injection of $15 billion.

Bank of America Corp and Citigroup Inc shares plummeted for a sixth straight day on Friday, hammered by fears that the U.S. government could nationalize the banks, wiping out shareholders.

Chase CEO Jamie Dimon, whose bank received $25 billion in bailout funds from the government, refused to tell CNBC anchor Melissa Francis how the bank is performing this quarter.

"Can you tell me how this quarter is doing for JPMorgan?" Francis asked.

Dimon's brief response: "I can't."

Banks can't unload their toxic assets. But what if their assets weren't toxic?

House members want the eight big banks to increase their lending and explain what they are doing with the taxpayers’ money.

U.S. Treasury Secretary Timothy Geithner will lay out a bank-rescue plan on Tuesday that will rely on public and private funds to take $500 billion of bad assets off banks' books, sources said.

The $700 billion financial-sector bailout is likely to rely on a broad range of tools, from injecting additional capital into banks and helping homeowners avoid foreclosure to expanding the roles of the Fed, Fannie Mae, Freddie Mac and the FDIC.