Taxpayers' Billions: How Banks Are Using It

The U.S. government has provided $45 billion to Bank of America through the Troubled Assets Relief Program, but how that money has been used remains unclear.

When ABC News asked for details as part of a larger, ongoing project, a bank spokesman said the questions -- almost identical to inquiries made by a congressional oversight panel of the Treasury Department -- "show a fundamental lack of understanding about the TARP program, what it was intended to do and how it works."

Just today, Bank of America received $20 billion in new taxpayer dollars -- bring its total government aid to $45 billion -- to finalize its hastily arranged purchase of investment bank Merrill Lynch.

"With these transactions, the U.S. government is taking the actions necessary to strengthen the financial system and protect U.S. taxpayers and the U.S. economy," the Treasury said in a statement overnight. "As was stated in November when the first transaction under the Targeted Investment Program was announced, the U.S. government will continue to use all of our resources to preserve the strength of our banking institutions and promote the process of repair and recovery and to manage risks."

The ABC News Business Unit posed the same five questions to Bank of America and 23 other banks that received at least $1 billion in TARP funds. The questions covered topics including lending activity, foreclosure assistance and bonuses. Four banks that received a total of $31 billion in TARP funds chose not to reply, including JPMorgan Chase, which received $25 billion and did not reply to similar questions in December.

Of the 20 banks that did respond, only five provided details about increased lending activity. Six banks gave some indication of the steps they are taking to help people in danger of losing their homes to foreclosure. Only a quarter of the banks surveyed said TARP funds would not be used to pay for bonuses.

The lack of details mirrors the responses provided by the Treasury Department, which is overseeing the TARP program, to a congressional oversight panel.

How Is TARP Being Spent?

In a sharply worded report released last week, the panel said it "still does not know what the banks are doing with taxpayer money."

These are the five questions asked by ABC News:

Since you received TARP funds has there been an increase in lending activity by your bank, if so by how much?

What amount of TARP funds have been used to help homeowners who are behind on their payments or facing foreclosure?

Does your bank need the TARP infusion? If not have you considered returning the funds?

What will be the total amount awarded in bonuses at your institution this year?

If Congress passes retroactive compensation requirements for TARP Capital Purchase Program participants, will your bank give back the money?

Citigroup said it will make the $45 billion it has received available to "existing and new customers for mortgages, personal loans, student loans, small business and corporate loans and credit card lines."

Wells Fargo & Co. said the $25 billion it received would be used "to make more loans to credit-worthy customers and to find solutions for our mortgage customers late on their payments or facing foreclosure."

Morgan Stanley said, "TARP capital has allowed Morgan Stanley to make several multi-billion dollar loan commitments to leading American companies."

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