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Wednesday, October 15, 2008

U.S. Government to Invest in 9 Major Banks

Yesterday morning, the U.S. government announced plans to buy stakes in 9 major banks to calm market. The government will directly invest up to US$250 billion in banks, and to guarantee new debt issued by banks for the next three years.

Half of the US$250 billion, which will come from the US$700 billion bailout approved by Congress weeks ago, will be received by Citigroup, JPMorgan Chase, Wells Fargo, Bank of America, Merrill Lynch, Goldman Sachs, Morgan Stanley, Bank of New York and State Street Bank.

Money Distribution

US$25 billion apiece
• Citigroup
• JPMorgan Chase
• Wells Fargo

US$12.5 billion apiece
• Bank of America
• Merrill Lynch

US$10 billion apiece
• Goldman Sachs
• Morgan Stanley

US$2-3 billion apiece
• Bank of New York
• State Street

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