Maryland bank repays half of its TARP money

Sandy Spring Bancorp Inc., the parent company of Maryland's Sandy Spring Bank, has repaid half of the $83 million in taxpayer money it received through the Troubled Asset Relief Program.


The company recently announced that it had turned a $5.1 million profit for the second quarter, compared to a $1.5 million loss a year earlier, and had received the go-head from the Treasury Department to return half of its TARP aid.


Sandy Spring sold more than $83 million in preferred stock to the Treasury through TARP's Capital Purchase Program. Since accepting that money in December 2008, it has since paid almost $5 million in dividends to the U.S. government.


Sandy Spring has shown signs of improving financial health in the first six months of 2010. Net income available to common stockholders amounted to $4.4 million during that period, compared with a net loss of $465,000 for the same span in 2009.


The Olney, Md.-based company's non-performing assets fell for the third consecutive quarter, and total assets have risen about  2 percent over the past year.


Daniel J. Schrider, Sandy Spring's president and chief executive officer, was restrained but optimistic regarding the company's financials.


He pointed to the company's successful common stock offering in the first quarter of 2010 as the vehicle that made the partial TARP redemption possible.  He also expressed hope that continued negotiations with the Treasury will "secure their approval for repayment of the remaining balance in the coming months."


Although the company's announcement did not list an expected repayment date, Treasury said in a transaction summary that the company retired $41.5 million of its preferred stock on July 21.


Sandy Springs's release did not mention the warrants for common stock that it also issued the government in the TARP deal. It noted in the prospectus for the stock offering that it had not decided whether it would seek to repurchase the warrants or let Treasury sell them at auction.



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