February 21, 2009

Senate Banking Committee Chairman Christopher Dodd said banks may have to be nationalized for “a short time” to help lenders such as Citigroup Inc. and Bank of America Corp. survive the worst economic slump in 75 years. “I don’t welcome that at all, but I could see how it’s possible it may happen,” Dodd said today on Bloomberg Television’s “Political Capital with Al Hunt” to be broadcast this weekend.

“I’m concerned that we may end up having to do that, at least for a short time.”Bank of America and Citigroup, which received $90 billion in U.S. aid in four months, tumbled as much as 36 percent today on concern they may be nationalized.The Obama administration today said a “privately held” banking system is the “correct way to go” and House Financial Services Committee Chairman Barney Frank said nationalization ought “to be avoided.”