3 Banks Want to Pay Back TARP as Soon as Possible

Banks raising funds by selling stocks

Last week, the results of bank stress tests were announced, and the government named 10 banks that were in need of capital. However, the other 9 banks were giving clean bills of health. Now, with that designation, 3 of the banks want to raise money to pay back TARP funds as soon as possible.

Because TARP funds come with government strings attached, it is  no surprise that some banks want out from underneath the thumb of the government as quickly as they can manage. This means they pay back the bailout money they received, and in return end up with less government oversight. Stock Market Funding reports on the banks that want to repay TARP now, and how they expect to raise the funds:

U.S. Bancorp, Capital One Financial Corp. and BB&T Corp. have all announced common stock offerings, proceeds of which will be used, subject to approval, to help repay preferred stock investments the government made as part of the U.S. Treasury’s TARP Capital Purchase Plan.

The government still has to approve the repayment of funds, but many think it is a good idea for banks to repay TARP as soon as possible. It would free up additional funds for economic stimulus, and possibly encourage other banks to take similar steps, ultimately saving taxpayer money.

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