Morgan Stanley joins US banks raising cash to repay government

New York - Morgan Stanley on Tuesday said it would raise 2.2 billion dollars in a new stock offering, hoping to join two other financial firms as the first major companies to pay back emergency government loans handed out at the height of the credit crisis. JPMorgan Chase on Monday night announced it would raise 5 billion dollars with a sale of common stock, while credit card giant American Express said it would raise 500 million dollars. The stock offerings were the result of new requirements set by the Federal Reserve on Monday. It is up to government regulators to decide whether banks meet a series of conditions to repay the loans, and the US central bank said it may approve some requests next week. JPMorgan Chase, which owes 10 billion dollars, and American Express, which has taken 3.4 billion dollars, were among nine of 19 major firms that passed the government's 'stress tests' - a comprehensive review of their balance sheets - completed last month. Morgan Stanley, which owes the government 25 billion dollars, was told it needed to raise 1.8 billion dollars in additional capital. With Tuesday's offering, it has collected nearly 6.8 billion dollars since the stress test results. Meanwhile, Bank of America, one of the banks worst hit by the financial crisis, on Tuesday said it has raised 33 billion dollars through a series of stock offerings and other methods. The stress tests found it needed 33.9 billion dollars in extra capital. In a statement, Bank of America said it expected to 'comfortably exceed' the government target. Both Morgan Stanley and JPMorgan Chase said they expect to return the Treasury Department's funds by the end of June. Goldman Sachs has also applied to pay back 10 billion dollars. The Treasury has spent about 600 billion dollars bailing out financial firms and car companies since October, in an effort to keep Wall Street from complete collapse and keep them lending to consumers. The chronic credit shortage has already sent the wider US economy into its deepest recession since the Great Depression. The Treasury is wary of harming consumers' access to loans - and possibly reigniting the credit crisis - by letting firms give back the government funds too soon.