NEW YORK: Bank of America Corp. Chief Executive Kenneth Lewis says the $25 billion the government is injecting into his bank will be put to work making loans and will be paid back at the latest in five years.
In an interview aired Sunday on CBS' "60 Minutes," Lewis confirmed that top executives were given no option last week when Treasury Secretary Henry Paulson unveiled a plan for the government to pour $125 billion into nine major banks. In return, the government will get ownership stakes in the financial institutions.
Lewis said Paulson told the executives that the money being loaned to the banks to jump-start frozen U.S. lending was "the right thing for the American financial system, and therefore it was the right thing for America."
He told the news program that he was stunned at the amount being loaned, but believes the $25 billion received by the Bank of America, which is based in Charlotte, North Carolina, will be put to good work. However, the Treasury's plan does not demand banks use the money for consumer or corporate lending — and could instead use it to buy weaker companies.