ETF News

Senators ask for details on JPMorgan-Bear Stearns

WASHINGTON (Reuters) - Leaders of the U.S. Senate Finance Committee on Wednesday asked the Federal Reserve, the Treasury Department, JPMorgan Chase & Co JPM.N and Bear Stearns BSC.N for more details about JPMorgan's plan to buy Bear Stearns.

Democrat Max Baucus, chairman of the committee, and Charles Grassley, the top Republican on the panel, asked the parties to provide a memo describing the Bear Stearns assets that will be secured by the Federal Reserve.

“Americans are being asked to back a brand new kind of transaction, to the tune of tens of billions of dollars,” Baucus said in a statement.

“Economic times are tight on Main Street as well as on Wall Street, and we have a responsibility to all taxpayers to review the details of this deal.”

With support from the Fed and the Treasury Department, Bear Stearns has agreed to be sold to JPMorgan for about $10 a share. As part of the deal, the Fed agreed to guarantee up to $29 billion of Bear Stearns’ assets.

The agreement has raised concerns that the U.S. government is prepared to help rescue a failing Wall Street bank while declining to bail out millions of home owners facing the possibility of foreclosure.

The senators’ letter was addressed to Bear Stearns Chief Executive Alan Schwartz, JPMorgan CEO James Dimon, Federal Reserve Bank of New York President Timothy Geithner, Fed Chairman Ben Bernanke, and Treasury Secretary Henry Paulson.

The letter was posted on the Internet at: here.

Reporting by Rachelle Younglai; Editing by Brian Moss and John Wallace