Remember back when the TARP was going to be about purchases our troubled assets from banks? Then the government switched to direct capital injections. And later the Federal Deposit Insurance Corp said it was launching a legacy loan program? Well, that’s been delayed again.
Later today the FDIC said it is postponing its planned June pilot sale of toxic bank loans. Of course, it says the overall program will continue but who knows. The official line is that banks have been raising so much money that they don’t really need to sell their assets through the Legacy Loan Program.
“As a consequence, banks and their supervisors will take additional time to assess the magnitude and timing of troubled assets sales as part of our larger efforts to strengthen the banking sector,” FDIC Chair Sheila Bair said in a statement.