The biggest U.S. banks reduced lending in the closing months of last year, the Treasury Department reports. The decline came even after the banks tapped into government rescue-plan funds. Bank of America and Citigroup, the banks that received the most government money, had the biggest drop-off in lending. The Treasury cautioned that the decline doesn't mean the investments aren't working. Lending "levels would likely have been lower had Treasury not taken actions to stabilize the financial system," the department's analysis said.

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