Obama Set To Announce New Bank Tax On Thursday

Public unrest over the big bonuses that banks are set to pay out barely a year after taxpayer money was used to pull them back from a financial meltdown has reached a boiling point.

Now President Barack Obama is set announce plans on Thursday to help cover expected losses from the Troubled Asset Relief Program by enforcing fees on banks that received the bailout funds. The fee will be levied even on financial institutions that have already paid back TARP.

The proposed plans would raise up to $120 billion from major U.S. financial institutions, according to a senior administration official on Tuesday.

The U.S. Treasury said the fees will pay back any costs from the $700 billion bailout program, according to the administration official.

A TARP fee system has been discussed within the Obama administration since August and the President has made it know that it is a point to make sure that the taxpayers see their money recouped sooner than the legislation that created TARP mandates.

The current legislation states that the money spent on the TARP program be recouped by 2013. The legislation was enacted by former President George W. Bush to combat the financial crisis that plunge the country into the worst recession in 70 years and spiked unemployment to over 10 percent.

A source that would not be named from Washington told Reuters that many possible structures for a fee system, including one based on the total amount of a firm's liabilities. The source added that automakers GM and Chrysler and American International Group (NYSE: AIG) may be exempt from the fee.

Some banks that have paid back TARP but could be hit with the tax:
Bank of America (NYSE: BAC)
JP Morgan (NYSE: JPM)
Citigroup (NYSE: C)
Wells Fargo (NYSE: WFC)
Goldman Sachs (NYSE: GS)
Morgan Stanley (NYSE: MS)
PNC (NYSE: PNC)
U.S. Bancorp (NYSE: USB)

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