How banks are spinning the rescue…

October 28, 2008

Now that the Treasury Department has decided to let banks announce when the agency has decided to pony up money, banks are falling over themselves to issue press releases announcing the news.

The funny thing — depending on your sense of humor — is that most of the press releases sound as if they were written by the same exact person, because many of them sound as if they were doing Treasury, and by extension, the American public, a favor by taking the money. Take this one from SunTrust (STI), which announced yesterday morning that it had received preliminary approval to sell $3.5 billion in preferred stock to Treasury.

—Our participation in the Capital Purchase Program enhances SunTrust’s already solid capital position and will permit us to further expand our business and take advantage of growth opportunities, said James M. Wells III, Chairman, President and CEO. —In addition, we are pleased to support the Treasury in its ongoing effort to address dislocations in financial markets and spur the market stabilization that is in the public interest.

But we don’t mean to pick on SunTrust. NorthernTrust (NTRI) put out a press release yesterday to announce its $1.5 billion infusion because it “fully supports the U.S. government’s efforts to strengthen our nation’s financial system.” There’s also this one from Valley National (VLY): “Although Valley is a well-capitalized organization, we believe such a program provides an excellent opportunity for healthy strong banks like Valley to participate in and support the recovery of the U.S. economy”. Even relatively small banks seem to be on message, like First Niagara (FNFG) which said in its press release yesterday, “We are supportive of the Treasury Department’s efforts and remain strongly committed to supporting the economy in Upstate New York.

How patriotic of these banks! How selfless! It almost makes you want to burst into the Star Spangled Banner or go out and buy Liberty Bonds or something.

UPDATE: Looks like both Treasury and the White House is jumping into the fray today and encouraging banks to be even more patriotic and start lending.

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