WASHINGTON — The nation's largest banks, battling an image of jet-setting executives with multimillion-dollar salaries, will face tough scrutiny on Wednesday from lawmakers who are struggling to understand the financial health of the institutions and the impact of a $700 billion taxpayer bailout.
Eight chief executives are scheduled to testify at a hearing of the House Financial Services Committee.
Lawmakers are hoping for a comprehensive accounting of what the banking giants did with the money they got from the Troubled Asset Recovery Program and whether it appears to be stabilizing the financial services industry.
Taking a cue from congressional scrutiny of auto industry executives who came to Washington hat in hand, the bankers are expected to avoid any unwanted attention about corporate travel. It'll be harder, however, for them to dodge questions about their executive compensation packages that include millions in bonuses.
"If they didn't get a bonus, would they knock off early on Wednesday?" said Rep. Barney Frank, D-Mass., the committee's chairman, who like President Barack Obama is pushing for more modest compensation packages set with shareholder input.
The House hearing will be watched on both sides of the Capitol, where lawmakers are struggling to justify how federal bailouts and an $827 billion economic stimulus bill would help typical citizens struggling to stay afloat at home.
"Our bankers have really blown it here in terms of public image," said Sen. Lindsey Graham, R-S.C.
"My advice to any CEO is to restore trust and confidence by demonstrating you have the capability of managing any money you receive from the public sector, from the taxpayer, and use it wisely, that you have a plan to pay it back, you understand the nature of problem and you have a plan to fix it, and you're going to be frugal and thrifty with the money."
HOT SEAT
Banking executives are scheduled to testify 10 a.m. Wednesday before the House Financial Services Committee on how they used public funds from the Troubled Asset Relief Program.
Lloyd Blankfein, Goldman Sachs
James Dimon, J.P. Morgan Chase
Robert Kelly, Bank of New York Mellon
Ken Lewis, Bank of America
Ronald Logue, State Street
John Mack, Morgan Stanley
Vikram Pandit, Citigroup
John Stumpf, Wells Fargo
ON THE WEB
MORE FROM MCCLATCHY
Senate ends stimulus debate by 61-36 in sign bill will pass