PNC Financial Services Group Inc. will repay the $7.6 billion in bailout money it received within 15 months, according to a new report. The company had previously announced an intent to take as long as "a couple of years" to exit the program.
The latest announcement came as the bank released quarterly earnings data. It reported third quarter profits of $559 million and said its portfolio of bad loans was shrinking.
The company's stock rose more than 9 percent on the news, closing yesterday at $50.65.
PNC has been unique among larger banks in taking its time to repay money received under the Troubled Asset Relief Program. Most have rushed to redeem shares and warrants given the government in exchange for assistance, citing concerns over restrictions on executive pay and the distribution of dividends.
In order to exit the bailout program, the Treasury requires banks to prove they can survive without government aid and can raise money without government guarantees.
A stock offering has been a popular method of meeting both challenges, but PNC has explicitly rejected that option, saying it dilutes the holdings of existing shareholders. That position, however, has forced the bank to wait until its own capital position has sufficiently improved.
"You don't want the reason you're doing it to be simply because you don't like some of the actions coming out" of TARP, Rick Johnson, the bank's chief financial officer, said earlier this year. "What you want to do is have a good, logical approach to doing it, which is favorable to your shareholders."
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