* White House seeks to recoup bailout costs with bank fee
* Bailout costs currently estimated at more than $100 bln
* Fee could be based on liabilities, exclude automakers
(Adds updated loss estimate, details of bailout costs)
By Karey Wutkowski
WASHINGTON, Jan 12 A fee being considered for
banks could raise more than $100 billion if the Obama
administration seeks to recoup the current estimate of
financial bailout costs, but exact figures are preliminary.
A financial industry source in Washington told Reuters that
many options on how to structure such a fee are being
discussed, including basing it on the amount of a financial
The source, speaking anonymously because the fee has not
officially been proposed, said officials are also discussing
exempting automakers and insurer American International Group
(AIG.N) from the fee, even though they are expected to
represent a larger proportion of bailout losses.
The fee could be included in Obama's budget proposal for
fiscal 2011 to help recover some of the taxpayer money used to
bail out banks during the financial crisis, a senior
administration official said on Monday. The budget request is
expected to be sent to Congress in early February.
Talks about the details of such a proposal are fluid,
including the amount of such a fee.
Treasury's latest estimate on the ultimate taxpayer loss
from the $700 billion Troubled Asset Relief Program (TARP),
that began in late 2008, is $120 billion, according to a
However, Treasury believes that amount is a conservative
projection and has repeatedly downwardly revised its loss
The bank fee proposal come as President Barack Obama
attempts to take a hard stance against the huge bonuses that
many financial firms are poised to pay out so soon after the
The legislation that created TARP calls for taxpayer losses
to be recouped, but not until 2013, five years after the
legislation was passed.
The exact amount of potential losses has been a moving
target. In early December, Treasury dramatically cut its
estimate for the total loss of the program to $141 billion from
$341 billion earlier in the year.
The department then cut the estimate again to $120
Just this week, Treasury revealed its estimated net losses
associated with TARP for the fiscal year ended Sept. 30, 2009.
It said the losses for the year would likely be $68.5
That estimate included losses of $30.4 billion for AIG and
$30.4 billion for automakers, with $27.1 billion in losses from
the Home Affordable Modification Program.
Those loses were somewhat offset during the year by a $15
billion profit registered from the capital injections in banks
and $4.4 billion in profits from other bank investments, asset
guarantee and lending programs.
(Reporting by Karey Wutkowski; Additional reporting by Caren
Bohan, David Lawder and Steve Eder; Editing by Tim Dobbyn)