While larger banks rush to return bailout money received months ago, smaller banks show continued interest in the Troubled Asset Relief Program, with at least 11 taking a total of $96 million in government assistance in the past few weeks.
Suburban Illinois Bancorp, Inc. received the largest chunk of the recently disbursed funds, getting $15 million from the Treasury Department. The bank has more than $674 million in assets.
Minnesota-based Duke Financial Group, with assets of $743 million, received $12 million, as did California-based Farmers Enterprises Inc. Farmers has $734 million in total assets.
Other banks receiving money included University Financial Corp. ($11.9 million), M&F Bancorp ($11.7 million), Century Financial Services Corp. ($10 million), RCB Financial Corp. ($8.9 million), Biscayne Bancshares Inc. ($6.4 million), Merchants and Manufacturers Bank Corp. ($3.5 million), Manhattan Bancshares Inc. ($2.6 million) and NEMO Bancshares Inc. ($2.3 million).
The ongoing interest in TARP funding by small banks stands in sharp contrast to the behavior of most of the large banks that have received the largest amount of bailout assistance. The bigger financial institutions, such as Morgan Stanley and Citigroup Inc., have moved to get out of the program as soon as possible, citing regulatory restrictions on executive pay and dividend payments.
But smaller banks, most of which have lower compensation levels and fewer shareholders, are not as concerned about these regulatory fetters. Instead, they see TARP as an inexpensive way to raise capital in an uncertain economic environment.
"One of the only other options is to borrow from large banks and, frankly, they're not in the market to do that," Steve Anderson, chief executive of River Valley Bancorporation, told the Wall Street Journal last week. River Valley received $15 million in TARP funding.
Suburban Illinois Bancorp, Inc. received the largest chunk of the recently disbursed funds, getting $15 million from the Treasury Department. The bank has more than $674 million in assets.
Minnesota-based Duke Financial Group, with assets of $743 million, received $12 million, as did California-based Farmers Enterprises Inc. Farmers has $734 million in total assets.
Other banks receiving money included University Financial Corp. ($11.9 million), M&F Bancorp ($11.7 million), Century Financial Services Corp. ($10 million), RCB Financial Corp. ($8.9 million), Biscayne Bancshares Inc. ($6.4 million), Merchants and Manufacturers Bank Corp. ($3.5 million), Manhattan Bancshares Inc. ($2.6 million) and NEMO Bancshares Inc. ($2.3 million).
The ongoing interest in TARP funding by small banks stands in sharp contrast to the behavior of most of the large banks that have received the largest amount of bailout assistance. The bigger financial institutions, such as Morgan Stanley and Citigroup Inc., have moved to get out of the program as soon as possible, citing regulatory restrictions on executive pay and dividend payments.
But smaller banks, most of which have lower compensation levels and fewer shareholders, are not as concerned about these regulatory fetters. Instead, they see TARP as an inexpensive way to raise capital in an uncertain economic environment.
"One of the only other options is to borrow from large banks and, frankly, they're not in the market to do that," Steve Anderson, chief executive of River Valley Bancorporation, told the Wall Street Journal last week. River Valley received $15 million in TARP funding.
published June 30, 2009, 0 Comments
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