Another bank has notified the Treasury Department that it intends to return the bailout money it received just two months ago. And several more that have talked about giving back their taxpayer capital now say they intend to do so after completing regulatory "stress tests" in April.
West Virginia-based Centra Financial Holdings Inc. said it will redeem the $15 million in preferred stock the Treasury bought in January. It will also pay any accrued dividends on the shares.
Bank officials cited "recent actions, interpretations and commentary regarding various aspects of the program" as reasons to return the money. Although banks had to be classified as well-capitalized to receive money under the Troubled Asset Relief Program, many have come to feel that acceptance of the money may be being interpreted as market weakness.
Banks also have been concerned that the bailout money has come with too many regulatory restrictions, including limits on executive pay.
Bank of America Corp. plans to start repaying the $45 billion it received next month, CEO Kenneth Lewis said Wednesday. In addition to concerns about oversight, Lewis cited the $2.85 billion annual dividend payments as a reason to return the money.
In recent months, a number of banks have said they would like to withdraw from the program, including JPMorgan Chase & Co., Goldman Sachs Group Inc., Wells Fargo & Co., and TCF Financial Corp.
Giving the money back, however, can be a challenge, because removing the money from a bank's balance sheet may reduce its capital levels. Government regulators are watching banks carefully to make sure they have enough reserves to weather any future shocks.
Nevertheless, a few of the larger banks signaled this week that they were planning to move ahead as soon as the stress tests had been completed. Passing these tests, which involve a complex examination by federal regulators of TARP recipients' balance sheets, would send a strong signal to investors that the companies are in sound shape and do not need government assistance.
The Wall Street Journal reported today that JP Morgan intends to repay the $25 billion is received within eight months. Goldman Sachs may do the same with its $10 billion in bailout money by the end of April.
Other banks that have said they plan to return taxpayers' money include Citigroup Inc., Morgan Stanley, Northern Trust Corp, PNC Financial Services Group Inc and U.S. Bancorp.
Five banks besides Centra Financial have filed documents with the Treasury to formally begin the repayment process. They are: Bank of Marin Bancorp, Iberiabank Corp., Signature Bank, Sun Bancorp Inc. and TCF Financial Corp.
West Virginia-based Centra Financial Holdings Inc. said it will redeem the $15 million in preferred stock the Treasury bought in January. It will also pay any accrued dividends on the shares.
Bank officials cited "recent actions, interpretations and commentary regarding various aspects of the program" as reasons to return the money. Although banks had to be classified as well-capitalized to receive money under the Troubled Asset Relief Program, many have come to feel that acceptance of the money may be being interpreted as market weakness.
Banks also have been concerned that the bailout money has come with too many regulatory restrictions, including limits on executive pay.
Bank of America Corp. plans to start repaying the $45 billion it received next month, CEO Kenneth Lewis said Wednesday. In addition to concerns about oversight, Lewis cited the $2.85 billion annual dividend payments as a reason to return the money.
In recent months, a number of banks have said they would like to withdraw from the program, including JPMorgan Chase & Co., Goldman Sachs Group Inc., Wells Fargo & Co., and TCF Financial Corp.
Giving the money back, however, can be a challenge, because removing the money from a bank's balance sheet may reduce its capital levels. Government regulators are watching banks carefully to make sure they have enough reserves to weather any future shocks.
Nevertheless, a few of the larger banks signaled this week that they were planning to move ahead as soon as the stress tests had been completed. Passing these tests, which involve a complex examination by federal regulators of TARP recipients' balance sheets, would send a strong signal to investors that the companies are in sound shape and do not need government assistance.
The Wall Street Journal reported today that JP Morgan intends to repay the $25 billion is received within eight months. Goldman Sachs may do the same with its $10 billion in bailout money by the end of April.
Other banks that have said they plan to return taxpayers' money include Citigroup Inc., Morgan Stanley, Northern Trust Corp, PNC Financial Services Group Inc and U.S. Bancorp.
Five banks besides Centra Financial have filed documents with the Treasury to formally begin the repayment process. They are: Bank of Marin Bancorp, Iberiabank Corp., Signature Bank, Sun Bancorp Inc. and TCF Financial Corp.
published March 26, 2009, 0 Comments
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