School of Law Professor Cornelius Hurley, director of the Morin Center for Banking and Financial Law and former counsel to the Fed Board of Governors, says CEOs of TARP-assisted banks must start clearing their toxic assets or get out.
“Asked (Sunday) whether the government would force banks to sell their toxic assets and begin lending again, Treasury Secretary Geithner was noncommital. CEOs of TARP banks need to be instructed by their regulators that if they do not participate in the balance sheet-clearing program they will be treated the same as GM CEO Waggoner.
“In anticipation of the toxic asset sales: (1) banks need to begin the process of adjusting the value of their loans and investments to reflect marketplace reality; and (2) regulators (FDIC, FED, and OCC) must signal their intention to enforce the Prompt Corrective Action provisions of the law.”
Contact Cornelius Hurley, 617-353-5427, firstname.lastname@example.org