Lloyd Blankfein from Goldman Sachs acknowledged to the committee that the banks faced "broad public anger" and that they had to "regain the public's trust and do everything we can to help mend our financial system to restore stability and vitality.''
Barney Frank, chairman of the committee, said the banks had to show they were "willing to make some sacrifices to get this [economy] working."
Both Republicans and Democrats are angry for what they see as a lack of transparency over the handling of the bailout, passed under the administration of George Bush, the former president.
Critics are angry that big banks that benefited from the federal bailout, designed to encourage banks to lend money to consumers and small businesses, but spent lavishly, including granting enormous salaries and bonuses to those appearing before the committee.
|Citigroup executives were among those
being questioned [GALLO/GETTY]
Those testifying are Jamie Dimon from JP Morgan Chase, John Mack from Morgan Stanley, John Stumpf from Wells Fargo, Ken Lewis from the Bank of America, Vikram Pandit from Citigroup, Ronald Logue from State Street, Lloyd Blankfein from Goldman Sachs, and Robert Kelly from the Bank of New York Mellon Corporation.
The executives assured lawmakers that the billions of dollars in taxpayer money had been used to boost lending, not to pay executives, lobbyists or shareholder dividends.
"We have a hard-earned reputation for frugality, not extravagance," said Ken Lewis, chief executive officer for Bank of America.
"Taxpayers have invested in our company, and they deserve to know what return they are making on their investment and when it will be paid back."
Rob Reynolds, Al Jazeera's senior Washington correspondent, said the questioning showed the excecutives appeared not have adjusted quickly enough to new economic realities following the global economic crisis.
"They have not gotten the message....that the lavish corporate lifestyles of the past are over," he said.
The men's appearance before the committee is the first time so many bank executives will face such a grilling from Washington politicians.
It also comes a day after Timothy Geithner, the US treasury secretary, unveiled plans to revamp the bailout, or Troubled Asset Relief Programme (Tarp).
The US economy has been hit by tight credit, the subprime mortgage crisis and slumping global markets.
Geithner pledged more money to reduce housing foreclosures, and an attempt to get private capital involved in buying toxic assets from struggling financial institutions.
However, US stocks fell following his announcement, with critics saying the plan was vague and that the treasury secretary did not reveal enough detail about the plans.