WASHINGTON  – The White House says Treasury Secretary Timothy Geithner (GITE-nur) will visit Capitol Hill on Thursday to start outlining President Barack Obama’s plans to update financial regulations.

White House spokesman Robert Gibbs said Monday the administration hopes to have regulatory legislation in place by the end of the year. Gibbs says those regulations are important to help stabilize the global market.

When asked about the White House’s timetable for outlining its plan for financial regulations, Gibbs announced Geithner’s testimony.

Gibbs says he isn’t sure if Geithner would testify in the House or Senate. Geithner faces critics in both chambers.

WASHINGTON- The Bush administration overpaid tens of billions of dollars for stocks and other assets in its massive bailout last year of Wall Street banks and financial institutions, a new study by a government watchdog says.

The Congressional Oversight Panel, in a report released Friday, said last year’s overpayments amounted to a taxpayer-financed $78 billion subsidy of the firms.

The findings added to the frustrations of lawmakers already wary of the $700 billion rescue plan, known as the Troubled Asset Relief Program. Congress approved the plan last fall, but members of both parties criticized spending decisions by the Bush administration and former Treasury Secretary Henry Paulson.

Financially ailing insurance giant American International Group, which the Treasury Department deemed to be too big to be allowed to fail, received $40 billion from the Treasury for assets valued at $14.8 billion, the oversight panel found.

In December, in response to questions from the oversight panel, Paulson wrote that the value of preferred stock purchased by the government was “at or near par,” meaning Treasury paid $1 for every $1 dollar of asset.

“The way the Treasury secretary described it does not fit with the numbers that were produced in our much more extensive valuation analysis,” panel chairwoman Elizabeth Warren told reporters Friday. “The secretary of the Treasury described it in December that these were par transaction and that is not supported by the numbers.”
 
The continued scrutiny comes as new Treasury Secretary Timothy Geithner prepares to place the Obama administration’s imprint on the program with a sweeping new framework for helping banks, loosening credit and helping reduce foreclosures. Geithner plans to unveil the changes Monday.

And while Paulson is gone and Geithner is in charge, the program itself remains in the hands of Neel Kashkari, a holdover from the Bush administration.

In December, Kashkari defended the Treasury purchasing strategy as bank stock prices dropped.

“We’re not day traders, and we’re not looking for a return tomorrow,” he said. “Over time, we believe the taxpayers will be protected and have a return on their investment.”

In a bright spot for the rescue program, the same banks that received capital infusions from Treasury have already paid $271 million in dividends to the federal government and are expected to pay $1.5 billion more in dividends by the end of this month. Wells Fargo, which received a $25 billion infusion, has already announced it would pay Treasury $371 million in dividends this month.

The oversight panel examined 10 transactions, including eight made under a capital purchase program designed to put liquidity into the banks in hopes of easing credit. That money went to banks considered “healthy” financially but in need of capital to make loans.

Two other transactions went to AIG and to Citigroup Inc. under programs designed to help companies that were facing serious financial difficulties.

Overall, the panel and the analysts it retained to conduct the valuation study found that the Treasury used taxpayers’ money to pay $62.5 billion more than the value of assets in the 10 transactions it examined. By extrapolating to the more than 300 institutions that received money, the panel concluded that the government in effect paid $78 billion more than the actual value of the assets at the time.

“Treasury chose to offer ‘one size fits all’ pricing in order to encourage all institutions to participate, and in so doing disregarded apparent differences in their financial condition,” the report states. “A consequence is that Treasury effectively offered weaker participants greater subsidies than it offered to stronger participants.”

Reacting to the panel’s conclusions, Treasury spokesman Isaac Baker said in a statement: “Treasury’s efforts since the fall prevented a systemwide collapse, but more needs to be done to stabilize the financial sector, increase lending and protect taxpayer dollars.”

He said the plan Geithner will announce Monday aims to free up credit, “while strengthening transparency and accountability measures so that taxpayers know where and how their money is being spent and whether it’s achieving real results.”

Senate Banking Chairman Chris Dodd, D-Conn., said the overpayment was sure to “raise eyebrows.”

“I can understand some gap,” he said. “No one is expecting perfection between the price you pay and what you think you’re getting. But that’s a pretty large disparity.”

WASHINGTON – A government watchdog group says the federal government overpaid for stocks and other assets from financial institutions under its $700 billion rescue program.

The chairwoman of the Congressional Oversight Panel for the bailout funds told the Senate Banking committee Thursday that Treasury in 2008 paid $254 billion and received assets worth about $176 billion.

The figures were reached by extrapolating the results of a study of 10 government transactions.

The Treasury by Jan. 23 had spent about $294 billion on more than 300 companies under the Troubled Asset Relief Program. In one bright spot, the inspector general in charge of reviewing the funds said the federal government has received more than $271 million

WASHINGTON – The Senate has confirmed New York Fed chief Timothy Geithner to be President Barack Obama’s secretary of the treasury.

The 60-34 vote puts Geithner at the helm of Obama’s plan to rescue the economy from the worst financial crisis in three generations. It also dislodges one of Obama’s most troubled nominations.

Some senators were concerned that Geithner, who would oversee the Internal Revenue Service, did not pay all of taxes until he had been tapped to the president’s Cabinet. Geithner called it an unintentional oversight and settled his $42,702 overdue tax bill.

Obama and others supporting Geithner’s nomination said the nation couldn’t afford to wait for Obama to search for another nominee to run the Treasury Department.

RALEIGH, N.C.- North Carolina Sen. Richard Burr says he’s can’t support President Barack Obama’s nominee to lead the Treasury Department.

The Republican from Winston-Salem said Friday he’s decided to vote against approving Tim Geithner to serve as Treasury Secretary.

The Senate Finance Committee has already cleared Geithner’s nomination, and the full Senate is expected to vote on Monday.

Burr said he’s concerned about the role Geithner played as head of the Federal Reserve Bank of New York in fighting the nation’s banking crisis.

Burr cited a proposed merger between Citigroup Inc. and Wachovia Corp. brokered late last year by the Federal Deposit Insurance Corp. The merger didn’t come to pass, but Burr said it is now clear that New York-based Citigroup was in major financial trouble when it was proposed.