After emerging from a meeting at the White House, many of the nation’s top banking CEOs briefed reporters on their 90-minute visit with President Obama, Treasury Secretary Tim Geithner, and other members of the administration.
The catch words thrown around were “cooperation,” “working together” and “recovery.”
The CEOs – many of whose companies and names have been drug through the dirt – intimated that much of the conversation was about the PR work that needs to be done on the economy rather than the nuts and bolts of economic recovery.
“We are responsible in some part for some sound bytes that have come out along the way. So we take ownership for that," said Richard Davis of US Bank. “But we’re going to move forward to give you better things to write about, to talk about, and better stories to show what’s happening in a great recovery,”
Davis went on to say that positive sound bytes are what the banking CEOs have not done a good job with and this is something that they will do more of going forward.
“Sound bytes are giving you the facts to talk about something positive, people in new houses, new buildings being built, new companies starting up and hiring new people, we’re doing that everyday but we haven’t done a very good job of telling you guys that.”
Davis said the “dialogue” will be changed to celebrate people’s success in the recovery.
Ken Lewis from Bank of America echoed those comments and said that going forward he will start asking his community bank groups to start talking about the “great things” they are doing in the community.
“We’re going to talk more and more about things starting to get better in different places and try to not talk about the past so much. And start talking about respectively about things that are really good for this country.”
THE TONE OF THE MEETING
The CEOs all called the conversation “very frank” and “open."
"Help me help you," was how JP Morgan Chase’s Jamie Dimon described the president’s message to them. "Be rational and reasonable about compensation. Keep lending."
“Our interests were very much aligned with the administration,” Robert Kelly of Bank of New York-Mellon said, “We want to get our banks bank to financial health – we know that we’re at the sharp end of the stick in terms of getting our economy back. We want to see the American recovery. We’re all working hard to make it happen.”
But Cam Fine, CEO of Independent Community Bankers of America, did acknowledge that there was some dissention during the discussion.
“The participants all expressed strong views to the president and the president expressed strong views to the participants. There were differences of opinion. I wouldn’t say it was contentious, but we weren’t all sitting around the table singing ‘Kumbaya’ either.”
The CEOs said Geithner’s plan for buying up toxic assets seemed like an “encouraging first step”, but more details need to be known.
“We need to hear the details. I think there’s going to be a lot of interest in it,” Kelly said. "Ultimately its really important that the buyers and sellers are able to meet at a price that makes sense for both. And the devil is in the details. But I think this is something that is potentially very exciting and really important for the industry and the country.”
Dimon said he is in favor of the program, even if JP Morgan Chase doesn’t participate. To describe the flurry of administration programs, he quoted Colin Powell’s line about "overwhelming force".
"I think when you look at them in total, it’s overwhelming force. Whether any one works exactly the way you expect it to, I don’t think that’s as important. I think they’re pretty powerful programs."
However, Fine said that the administration should hold off on unveiling so many programs…and start finding out which ones work or not.
"Give some of these programs a chance to work. I mean, they announce a program on Monday and then they’re announcing a new program on Wednesday and yet another program on Friday. Let’s give some of these programs a chance to work before we keep introducing the next generation of program."
There seemed to be conflicting viewpoints on the extent of the discussion over executive compensation, perhaps because some CEOs preferred to tune out that part of the conversation.
“Executive compensation was not part of the discussion,” Richard Davis said.
But in an interview with ABC, Fine said that executive compensation wasn’t dealt on much, but was definitely discussed.
“The president mentioned that perhaps bonuses had gotten out of control on Wall Street. The executives around the table from the big banks actually did a sort of mea culpa and said ‘yeah, maybe things got a little out of control. We’re going to do better in the future, Mr. President’."
Said Dimon, "I think he said that some of it wasn’t earned or deserved, that we should be very conscious of why there’s anger out there, that if the banks contributed to this terrible problem we’re in, that should be deeply recognized by them and I think it is recognized by those CEOs."
He added, "When you come to Washington, you have to feel that there’s a deep anger about what happened in this country. Banks are being blamed. I think that they shouldn’t only be blamed, but they certainly participated in it. So when you come to Washington, you do feel it. And obviously the White House feels it intensely and they share that with us."
The CEOs expressed support for proposal for stronger regulation so that the government can seize control of non-bank groups.
“I think it would be fair to say that we have a pretty old and antiquated kind of creaky regulatory system that needs to be modernized in this county and I think that’s going to happen," one of the CEOs said, "There’s a number of great proposals on the table including consolidating of the number of regulators, including having a systemic regulator, we’re all very supportive of that.”
On the discussion of the TARP money and if the banks would be giving that money back soon, Cam Fine told ABC News, “I think every bank in the room wants to return their TARP money, but not so much because of the strings that are starting to be attached or may be attached, but because I think they’re starting to feel confident enough that they don’t need it. At least several of the banks in the room expressed a desire to give it back as soon as they could give it back."
And Fine expressed optimism that the nation might be getting close to the end of the current recession, noting that, "There’s now mixed signals. Where a month ago it was all black, now we’re starting to see points of light. So I think we must be getting close to the bottom on this thing."
Said Dimon, "We’re gonna get through it. Everyone is gonna do everything they can to make this country get back on healthy feet again. People always ask when. To me, whether it’s three months, six months, a year, it doesn’t matter. You put your elbow down, you put elbow grease in it, you put your shoulder into it, and you push until you have to stop pushing."
-Matt Jaffe and Sunlen Miller