RPT-UPDATE 1-Bernanke says did not negotiate with AIG lenders

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WASHINGTON, Jan 27 (BestGrowthStock) – U.S. Federal Reserve
Chairman Ben Bernanke said on Wednesday he was not directly
involved in negotiations with the counterparties of insurance
giant AIG, having delegated the duties to the New York Fed.

The AIG bailouts, which after several rounds totaled about
$180 billion, have become a symbol of what many Americans feel
was a lopsided approach to financial rescues, favoring big
banks at the expense of average citizens.

The New York Fed, then led by current Treasury Secretary
Timothy Geithner, has been accused of bungling the
negotiations, paying AIG’s lenders in full instead of driving a
harder bargain on behalf of U.S. taxpayers.

But Fed chief Ben Bernanke, whose nomination for a second
term at the helm of the U.S. central bank is up for a vote this
week, said he was not at the forefront of AIG-related
discussions.

“I was not directly involved in the negotiations with the
counterparties,” Bernanke said in a letter to Representative
Darrell Issa, the top Republican in the U.S. House Oversight
Committee.

Congress on Wednesday was holding hearings regarding the
decisions surrounding the bailouts, and the anger was
palpable.

“In effect, the taxpayers were propping up the hollow
shell of AIG by stuffing it with money, and the rest of Wall
Street came by and looted the corpse,” said the committee’s
chairman, Representative Edolphus Towns, a New York Democrat.

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RPT-UPDATE 1-Bernanke says did not negotiate with AIG lenders