• Following a similar move by Morgan Stanley last week, Citigroup and Bank of America are raising base salaries for bankers. It's designed to make up for the new limits on annual bonuses (and won't make up for the difference, by any means), so don't expect shouts of joy at either bank today. [WSJ]
• Bank of America has scraped together another $5.9 billion, which means it's now 76 percent of the way toward filling its $33.9 billion capital hole. [WSJ]
• New York State Controller Thomas DiNapoli is cutting ties with 10 hedge fund managers as part of the state's pension corruption investigation. [DB]

• Some banks are pushing Washington to let them use public money to buy troubled assets from the banks themselves. Yea, that makes sense. [WSJ]
• Banco Santander has agreed to pay $235 million to settle claims related to Bernie Madoff investments made by two of its hedge funds. [NYP]
• Although Lazard's Bruce Wasserstein appeared to have burned his bridges to Time Warner a few years ago when he helped Carl Icahn try and break up the media giant, Lazard's now a contender to help TW spin off its cable unit. [WSJ]
• Good news: The U.S. recession will probably end in the third quarter, according to a new survey of business economists. [BN]