It’s not like we didn’t already know the banks were opposed to forgiving principal on troubled loans, even though they claim they are doing a little of that now. But today CNBC’s Melissa Francis got an earful from JPMorgan Chase’s [ JPM 45.53  -1.03 (-2.21%) ] Charlie Scharf, CEO of Retail Financial Services.

“We’ve got to be very careful that we don’t create an environment where we encourage people not to pay, and that’s the danger you have when you get into broad based principal forgiveness,” said Scharf.

This is all in reaction to the big push on principal reduction by state attorneys general, meeting in Washington DC this week. While the head of the 50-state investigation into so-called “Robo-signing” foreclosure paperwork issues, Iowa Attorney General Tom Miller, did not put forth a fine or penalty fund in his first settlement proposal, the expectation is that banks will be subject to such a fine that would be used for banks to write down mortgage principal.

Already, Senate republicans are blasting any payment.

Sen. Richard Shelby, the top republican on the Senate Banking Committee, at a hearing today put the number to be “extracted” from banks at $30 billion.

Page 1 of 2 | Next Page
Show Entire Article

China Inflation Holds Steady but Tightening not Over

Friday Look Ahead: Traders Watch Saudi Arabia Economic Reports

Pimco Move Could Send More Investors Out of Treasurys

US Spy Chief Says Gaddafi Forces to Prevail

US, Brent Crude End Lower as Markets Digest Saudi Unrest

More Top Stories

Article source: http://www.cnbc.com/id/41993215?__source=RSS*blog*&par=RSS