Obama's Influence on Bank Lending Is in Doubt

[Purveyor]

President Obama urged bankers Monday to do more in "every responsible way" to increase lending to consumers and small businesses.

But how much pressure is Obama actually exerting on banks, and what effect will it have?

Experts who spoke to ABCNews.com on the issue were skeptical, leaning on the side of not much.

The country's major banks have already repaid or are on track to repay billions in bailout funds from the government's Troubled Asset Relief Program -- a move that will free them from government compensation restrictions. But economists say that Obama and elected officials still, theoretically, have tremendous influence over the banks because of the banking reform efforts sweeping the nation's capitol.

"Fundamentally, they're in the midst of rewriting banking regulations that are going to affect how these guys operate for the next two decades or more," said Harvard economics professor and former Federal Reserve economist Kenneth Rogoff. "Certainly the president has a lot of sway over them."

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http://abcnews.go.com/Business/obamas-influence-bank-lending-doubt/story?id=9334971