Big Banks Settle on Superfund Terms

Paulson says fund will help, but analysts bearish on its prospects
By Wesley Oliver,  Newser Staff
Posted Nov 11, 2007 12:49 PM CST
Big Banks Settle on Superfund Terms
Secretary of the Treasury Henry Paulson testifies before the House Financial Services Committee Thursday, September 20, 2007 on Capitol Hill in Washington. (AP Photo/Lauren Victoria Burke)   (Associated Press)

The country’s top three banks have finalized agreements for the $75 billion superfund they hope will cushion further blows to the credit market, reports the NY Times. After nearly two months of haggling, Bank of America, Citigroup, and JPMorgan Chase agreed to simpler conditions than outlined in the fund’s proposals, but some analysts still insist the fund won’t succeed.

Treasury Secretary Hank Paulson admits the fund isn’t “a savior,” but argues, “Anything at the margin that will speed up liquidity is worth trying.” The banks will need any support they can get, as debt market conditions continue withering and investor resistance to pooled assets solidifies. Major credit rating agencies have yet to bless the superfund. (More Citigroup stories.)

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