The U.S. Department of Treasury has announced it is winding down its remaining Troubled Asset Relief Program (TARP) bank investments. The Treasury announced it has priced secondary public offerings of the preferred stock it holds in seven financial institutions this week. The aggregate net proceeds to Treasury from the seven offerings are expected to be approximately $245 million, an overall total of 15% above the minimum prices set for the auctions.
TARP’s bank programs have already earned a significant profit for taxpayers. Including the expected proceeds from today’s transaction, Treasury has now recovered $264 billion from TARP’s bank programs through repayments, dividends, interest, and other income – compared to the $245 billion initially invested. Each additional dollar recovered from TARP’s bank programs is an additional dollar of profit for taxpayers.
Assistant Secretary for Financial Stability Timothy G. Massad stated, “We’re pleased with the results of today’s auction, which enabled these community banks to replace temporary government support with new private capital, and keeps us on track to earn a positive return for taxpayers from TARP’s bank programs in excess of $20 billion. TARP played a critical role in stabilizing an economy in freefall during the financial crisis, and we are continuing to make good progress in winding down the program and recovering taxpayer dollars.”
Read the Treasury press release.
Read ABA’s white paper: TARP Bank Programs Have Been Paid Back in Full.