WASHINGTON – Top executives of the nation’s biggest banks said Friday after meeting with President Obama that they will work with the administration on its economic recovery plans, but they want more specifics from the White House.
In an interview with CBS News, Obama said his overarching message was this: “Show some restraint. Show that you get that this is a crisis and everybody has to make sacrifices. They agreed and they recognized it. Now, the proof in the pudding is in the eating.”
Bankers said an administration proposal to jump-start lending, a problem at the heart of the industry’s crisis, is encouraging. “People are looking at that. It’s positive,” said Morgan Stanley’s John Mack. “We think it’s the right thing to do and now we just need to get the details.”
The administration announced a program this week to help banks free themselves of so-called toxic assets. These investments have tied up capital and kept them from resuming normal lending to consumers and businesses.
The plan calls for the administration to partner with private investors, the Federal Reserve and the Federal Deposit Insurance Corp. to buy as much as $1 trillion in toxic assets from banks. But one concern is whether private investors will participate and whether banks would be willing to sell the assets at the reduced prices they will be offered for them.
Bankers described a positive meeting and pledged to work with Obama on restoring the economy’s health.
“We want to see the American recovery,” said Robert Kelly, of Bank of New York Mellon Corp.
Obama invited chief executives from the 15 largest banks to the White House to discuss the economy and other issues.
Obama urged the CEOs to deal with their toxic assets. Obama and the executives also discussed the administration’s plan to stem the rise in home foreclosures, its proposal for tighter regulation of the financial industry, executive compensation, the financial bailout program and the “importance of recognizing what the American public is going through in this economic crisis,” White House press secretary Robert Gibbs said.