Fed's banking bailout figures revealed

30 November 2011

Banks in the US required emergency loans worth $1.2 trillion in a single day at the height of the global economic crisis, new figures have revealed.

According to data obtained under a freedom of information request, the Federal Reserve (Fed) had to grant this sum to financiers in danger of being overwhelmed by the downturn on 5 December 2008, Bloomberg reports.

Furthermore, documents from the institution also showed that its below-market interest rates allowed American banks to gain an additional $13 billion in profits around this time.

It was also revealed that taxpayers paid a price for this action, although the loans granted to struggling lenders were still repaid in full without losses.

Sherrod Brown, Democrat senator for Ohio, was quoted as saying: "When you see the dollars the banks got, it's hard to make the case these were successful institutions."

This comes after the Federal Deposit Insurance Corporation revealed last week (23 November) that US banks enjoyed their highest net income since 2007 in the third quarter of this year.

By Tony Aynsley

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