According to the Wall Street Journal, American Express is seeking $3.5 billion in federal funds. It was reported on November 12, 2008, that American Express, a credit card company, applied to the Troubled Asset Relief Program (Tarp), a part of the Treasury Department's bailout plan.Times Online: American Express seeks $3.5bn Treasury funds (November 12, 2008)
The program, which was established under the Emergency Economic Stabilization Act of 2008, allows funding for bank-holding companies who need to be rescued. American Express was approved to become a bank-holding company on Monday, November 10, 2008.Times Online: American Express seeks $3.5bn Treasury funds (November 12, 2008)
American Express Bailout Quote
"Given the continued volatility in the financial markets, we want to be best positioned to take advantage of the various programs the federal government has introduced or may introduce. We will continue to build a larger deposit base to broaden our funding sources."—Kenneth I. Chenault, CEO of American ExpressThe New York Times: American Express to Be Bank Holding Company (November 10, 2008)
References
Fast Facts
-
Fact:
-
Fact:
-
Fact:
-
Fact:
The upgraded status of a full-fledged bank allowed for the company to request federal fundsThe New York Times: American Express to Be Bank Holding Company (November 10, 2008)
-
Fact:
The Federal Reserve approved the application for American Express to become a holding company due to "unusual and exigent circumstances"The New York Times: American Express to Be Bank Holding Company (November 10, 2008)
-
Fact:
-
Fact:
American Express also announced a plan to produce cost benefits through a company-wide reengineering initiative on October 30, 2008MarketWatch: American Express Announces Reengineering Plan to Generate.... (October 30, 2008)
