As with everything else, the bailout of the U.S. banking system is going to have unintended consequences. One of them seems to be giving exactly those firms that wasted billions of shareholder money a chance to double down. Flush with government money, these busted financial companies may just go on a shopping spree sponsored by Uncle Sam. Local banks are not too pleased.
Camden Fine, the chief executive of the Independent Community Bankers of America, said it was unfortunate that the U.S. treasury had imposed few conditions on the way the money was used, other than a stipulation that dividend payouts to shareholders must not rise.
“When you have taxpayers’ money used by larger banks to purchase otherwise healthy banks, that just promotes the kind of consolidation that got us into this mess in the first place,” said Fine.
“These taxpayer funds are intended to unfreeze the credit markets and to open up local economies — not to help investors in one bank buy out investors in another.”
–Guardian
Well said.