Since September, the watchdog organization Center for Public Integrity has pursued several investigations into the financial crisis, subprime mortgages, lending practices, and theuse of federal bailout dollars. And this week they share what these investigations turned up in a comprehensive online project titled Who's Behind the Financial Meltdown?: The Top 25 Subprime Lenders and their Wall Street Backers.
The project centers on 25 banks that together accounted for nearly $1 trillion of the nearly $1.4 trillion--or 72 percent--in "high-interest loans" that were handed out between 2005 and 2007. CPI analyzed government data on 7.2 million loans for the project. The lenders include some of the nation's largest banks (and recipients of TARP funds) like Wells Fargo, JP Morgan Chase, and Citigroup that have or had subprime lending units. Other lenders were subsidiaries of major financial institutions. Here are some of the topline findings of CPI's research:
-At least 21 of the top 25 subprime lenders were financed by
banks that received bailout money — through direct
ownership, credit agreements, or huge purchases of loans for securitization.
-Twenty of the top 25 subprime lenders have closed, stopped
lending, or been sold to avoid bankruptcy. Most were not banks and were not
permitted to collect deposits.
-Eleven of the lenders on the list have made payments to
settle claims of widespread lending abuses. Four of those have received bank
bailout funds, including American International Group Inc. and Citigroup Inc.
CPI has developed some helpful interactive tools to get through all the data. For example, you can get information on one of the top 25 banks to the right. Click on company profile to access a series of maps that show where the company made its high-interest loans. Click here for the full report from CPI.
Posted
05-08-2009 1:31 PM
by
Graham Griffith