GAO: Banks Paying Back TARP with Federal Money
The Government Accountability Office says in a new report that banks that have repaid the Treasury Department's TARP bailout program did so with funds they received from other federal rescue programs.
The GAO’s finding undercuts the Treasury’s prior statements that effectively assert the Troubled Asset Relief Program has earned a profit for taxpayers. Specifically, the GAO says that, according to its new review, “as of January 31, 2012, 341 institutions had exited,” TARP, almost half by repaying…with funds from other federal programs.” For more, click here.
The GAO also finds that banks continue to stream out of TARP, but the number that are reneging or missing their required dividend and interest payments back to the Treasury program has risen.
A Treasury spokesman said that Congress specifically required that banks who participate in TARP could also participate in the Small Business Lending Fund. He also noted past comments from Assistant Secretary for Financial Stability Tim Massad, who said “we will continue to work to wind down the program in a way that ensures financial stability and protects the interest of taxpayers.”
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