The federal fund that was created to bail out the nation’s banks during the financial crisis has earned nearly $22 billion for U.S. taxpayers.
The $700 billion Troubled Asset Relief Program was created with the enactment of the Emergency Economic Stabilization Act of 2008.
TARP included the Capital Purchase Program, which enabled the Department of the Treasury to make direct investments in the biggest banks.
A report Wednesday from the Government Accountability Office
indicated that $204.9 billion had been disbursed through the CPP as of Dec. 31, 2016.
Repayments by banks came to $199.6 billion, with $5.1 billion written off and $0.2 billion still outstanding.
Total income earned by the Treasury on the investments — including dividends, interest income, warrant income and proceeds in excess of cost — amounted to $27.1 billion.
That put program-to-date net profit for the CPP at
$21.8 billion.
Out of 707 financial institutions that originally participated in the program, 696 have exited.
“Treasury officials expect that the majority of the remaining institutions will require a restructuring to exit the program,” the GAO said. “Restructurings allow institutions to negotiate terms for their CPP investments. With this option, Treasury requires institutions to raise new capital or merge with another institution and Treasury agrees to receive cash or other securities, typically at less than par value.”
