The U.S. Treasury Department today said that it will collect gross proceeds of $67 million from the sale of shares in 11 banks that received TARP bailout funds following the 2008 financial crisis. Treasury said that it has now recovered $267 billion from its TARP bank lending, about $22 billion more than the $245 billion originally used to bail out the banks.
Assistant Treasury Secretary Timothy Massad said:
[W]e're moving to wind down our remaining investments in a way that helps strengthen our nation's community banks and replaces temporary government support with private capital.
The modified Dutch auction included preferred shares and subordinated debt.
The better-than-expected return on TARP bank lending is almost entirely due to the increased market value of American International Group Inc. (NYSE: AIG) since the insurer's near-failure.
Including bailouts in the auto, housing and insurance industries, TARP is still forecast to cost taxpayers about $24 billion. Of the $700 billion authorized for the program, only $414 billion was ever disbursed.
The Treasury press release announcing the auction results is available here.
Filed under: 24/7 Wall St. Wire, Banking & Finance, Economy Tagged: AIG