TCF Financial Corp., which received $361.2 million through the Treasury Department's Troubled Asset Relief Fund (TARP), has changed its mind and wishes to return the money.
The company said that it had filed notice with the Treasury Department to redeem all of the 361,172 outstanding shares of preferred stock the government purchased in November as part of its effort to inject capital into the banking system.
The Wayzata, Minnesota-based bank said that it was motivated by the public perception that institutions that took TARP money were in bad financial shape.
"The rules have definitely changed" since November, said TCF Chairman and Chief Executive Officer William A. Cooper, who noted that the program was originally intended to shore up banks with healthy balance sheets.
"Recent actions by the U.S. Treasury and possible congressional or regulatory restrictions/mandates changed the rules," said Cooper. "As a result, public perception views those banks that took the TARP money as having done so out of weakness and a need to survive without distinction among TARP programs or individual bank capital adequacy."
Cooper did not elaborate on the government action he described, but continuing problems with the banking system since the beginning of the TARP program have attracted significant criticism for failing to revive the economy.
TCF is the second bank to formally apply to redeem stock purchased under the TARP program. In late February, Louisiana-based Iberiabank Corp. announced that it had asked to return the $90 million it had received in December. Northern Trust Corp., of Chicago, has said it also intends to repay the $1.57 billion in TARP money it received "as quickly as possible.''
The company said that it had filed notice with the Treasury Department to redeem all of the 361,172 outstanding shares of preferred stock the government purchased in November as part of its effort to inject capital into the banking system.
The Wayzata, Minnesota-based bank said that it was motivated by the public perception that institutions that took TARP money were in bad financial shape.
"The rules have definitely changed" since November, said TCF Chairman and Chief Executive Officer William A. Cooper, who noted that the program was originally intended to shore up banks with healthy balance sheets.
"Recent actions by the U.S. Treasury and possible congressional or regulatory restrictions/mandates changed the rules," said Cooper. "As a result, public perception views those banks that took the TARP money as having done so out of weakness and a need to survive without distinction among TARP programs or individual bank capital adequacy."
Cooper did not elaborate on the government action he described, but continuing problems with the banking system since the beginning of the TARP program have attracted significant criticism for failing to revive the economy.
TCF is the second bank to formally apply to redeem stock purchased under the TARP program. In late February, Louisiana-based Iberiabank Corp. announced that it had asked to return the $90 million it had received in December. Northern Trust Corp., of Chicago, has said it also intends to repay the $1.57 billion in TARP money it received "as quickly as possible.''
published March 3, 2009, 0 Comments
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