Wall St. CEOs berated by lawmakers

By Steve Holland and Karey Wutkowski

WASHINGTON (Reuters) - Wall Street bank executives squirmed under a public scolding in the U.S. Congress on Wednesday over how they used $176 billion in bailout money without noticeably improving the battered economy.

"America doesn't trust you anymore," Massachusetts Democratic Rep. Michael Capuano told eight bank chief executives during six hours of congressional questioning on the troubled bank bailout plan.

The lawmakers reflected public outrage over the failure so far of a $700 billion financial bailout program to stop the economic free fall and growing taxpayer fatigue as the price tag for rescuing the economy grows.

They demanded to know what the banks have done with the bailout money, given an ongoing credit crisis that has added to the country's deteriorating economy.

The CEOs, who as the titans of the once seemingly invincible capitalist society earned a total of $118 million in 2007, struck a contrite tone.

"I feel more like corporal of the universe, not captain of the universe at this moment," said Ken Lewis, CEO of Bank of America, as he came under intense questioning from California Democratic Rep. Maxine Waters.

The CEOs argued they had responsibly used the billions in taxpayer dollars to increase lending, not to pay executives, lobbyists or shareholder dividends.

Three of the biggest lenders to consumers -- Citigroup, Bank of America and JPMorgan -- said they made $340 billion in new loans in the fourth quarter of 2008.

British bank executives were also on the hot seat Wednesday as a parliamentary inquiry into that country's banking crisis continued.

And the Irish government beefed up its bailout package Wednesday with a pledge to inject $9 billion into two top banks in return for guarantees on lending.

QUESTIONS ON PAY

The eight U.S. CEOs, questioned about their own income, said they had received 2008 salaries ranging from $600,000 to $1.5 million and had not received bonuses.

All but one reported that their companies own or lease aircraft, prompting California Democratic Rep. Brad Sherman to advise them to give up the expensive planes.

"You could sell them," he said.

Prodded by New York Democratic Rep. Gregory Meeks on whether Americans deserved an apology for lax loan standards that fueled the now-collapsed debt bubble, Morgan Stanley CEO John Mack spoke up.