TOPEKA, Kan. (AP) _ The head of the Kansas Bankers Association says the state's banks are reluctant to take part in the capital Capital Feinjection program included in the financial bailout.
Association president Chuck Stones said "banks are very wary of the program'' that Congress approved last month as part of the $700 billion bailout. The Troubled Asset Relief Program injects capital in the form of preferred stock.
The Topeka Capital-Journal reported that Capitol Federal Financial of Topeka and UMB Financial Corp. of Kansas City, Mo., have both declined to participate.
Capitol Federal CEO John Dicus said the bank already has sufficient resources to continue lending money to home buyers. Dicus said the program's preferred stock requires payment of a 5 percent dividend rate, and that his bank would have to lend at 8 percent to cover the required rate.
(Copyright 2008 by The Associated Press. All Rights Reserved.)