Big Banks Ground Corporate Jets
Banks borrowing TARP money have had to establish a strict temporary policy on luxury expenditures, and that includes corporate jet travel. Banks should sell their corporate jets as promised.
By Xiang Ji
One heathy change brought about by the financial crisis is a cutback in executive perks. Take corporate jets, for example. Once these plush planes were routinely being used for non-business travel and even provided to retired executives. But incidents such as Citigroups attempt last January to buy a luxury jet at the same time that the bank was receiving a taxpayer bailout served as a reminder to make company jets plana non grata for beleaguered bank executives.
Banks borrowing TARP money have had to establish a strict temporary policy on luxury expenditures, and that includes corporate jet travel. Goldman Sachs, Citigroup and BofA Merrill have all prohibited their executives from using corporate jets for personal travel. BofA Merrill also opted not to renew an agreement with Charles Gifford, former CEO of FleetBoston Financial (which BofA acquired in 2004) that entitled him to use a company plane for up to 120 hours per year, or roughly half a million dollars worth of flying time. ....