Responding to Tester’s concerns, Banking Committee schedules hearing
Committee will investigate $30 billion bailout of Bear Stearns
(BOZEMAN, Mont.) – Responding to concerns raised by Senator Jon Tester, the Senate Banking Committee has scheduled a hearing next week to question the government's $30 billion bailout of troubled investment bank Bear Stearns.
Bear Stearns nearly folded earlier this month, but JPMorgan Chase bought the bank's assets for a staggering low rate of two dollars per share. The Federal Reserve Board, which is in charge of the nation's banking policy and answers to Congress, agreed to risk a nearly $30 billion loan to support the last-minute takeover.
The problem, Tester said, is that nobody knows where exactly all that money is coming from.
Tester is a member of the Banking Committee, which has jurisdiction over the Federal Reserve, the U.S. Treasury and the Securities and Exchange Commission (SEC). Tester said he would ask for a hearing about the takeover during an investor forum he hosted in Kalispell last week.
The Senate Banking Committee has scheduled a hearing for next Thursday. The Committee has called Fed Chairman Ben Bernanke, Treasury Secretary Henry Paulson and SEC Chairman Christopher Cox to testify.
"Montanans work too hard to have the government make decisions about their money without any oversight," Tester said. "We have a lot of questions for the top brass about why they thought it was necessary to commit $30 billion taxpayer dollars to bail out a bank."
"Jon has made it very clear that he wants to get to the bottom of the Bear Stearns takeover, and he's going to bring a lot of common sense to this hearing," said Sen. Chris Dodd (D-CT), Chairman of the Senate Banking Committee. "The people of Montana are lucky to have someone on their side demanding answers in Washington."
Other witnesses called to testify during next Thursday's hearing include the heads of JPMorgan Chase and Bear Stearns.