Monday, March 16, 2009

Another Bank Plays Games With Bailout Funds

This time it's Chicago-based Northern Trust:

Another bank with bailout money is partying all the way to the banquet.

Chicago-based Northern Trust was blasted Tuesday for accepting $1.6 billion in taxpayer dollars last November and spending big bucks hosting lavish events with A-list entertainers in Los Angeles last week.

Sheryl Crow, Chicago and Earth, Wind & Fire played at three private, bank-sponsored bashes as clients and employees dined on seared salmon, Angus fillet and black truffle cheese, reported

Guests flown in for the Northern Trust Open golf tournament enjoyed deluxe accommodations at posh hotels, including the Ritz-Carlton and Beverly Wilshire. Gift bags included blue Tiffany & Co. boxes with white bows.

Now that rings a bell...Northern Trust, Northern Trust...oh, yeah...that's where Obama got his below market loan on the mansion Tony Rezco helped him buy:

The freshman Democratic senator received a discount. He locked in an interest rate of 5.625 percent on the 30-year fixed-rate mortgage, below the average for such loans at the time in Chicago. The loan was unusually large, known in banker lingo as a "super super jumbo." Obama paid no origination fee or discount points. {..}

The Obama campaign called the rate "consistent with Northern Trust policies, and it reflected the base rate set for that period discounted to address the competition for the account and other opportunities, such as personal financial services, that the relationship would bring to Northern Trust."

Hmmm...Obama bought the place well below market price at the height of the real estate boom for for about $1.6 million, so the loan was likely about $1.28 million or so after the Obama's down payment.

Over a billion and a half in taxpayer bailout funds in exchange for a $1.28 million discounted sweetheart loan..not a bad investment, if I say so myself.

I suppose that was a piece of what those 'other opportunities' for Northern Trust added up to.

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