Posted by Dana Hickles on August 31, 2009 at 9:43pm
Report: U.S. turns profit on bank bailoutsDallas Business JournalThe U.S. government has made a profit of about $4 billion on the bank bailout program so far as some of the largest banks have already repaid their loans, according to a report by the New York Times.In the Dallas-Fort Worth area, locally-based Plains Capital Corp. was listed late last year as the recipient of $87.6 million in Troubled Asset Relief Program funds.To date, the Treasury says it has allocated $250 billion in TARP funds.The Associated Press is now reporting that lawmakers, including Sen. Dianne Feinstein, D-Calif.; and Olympia Snowe, R-Maine, are going to draft legislation that will force companies benefiting from the funds to report how the money is spent.The lawmakers' decision follows an Associated Press report in which the news agency said it had asked 21 banks how they’re spending the money — only to receive no answers or vague answers at best.The article said the profit so far amounts to about a 15 percent return annually, and that the news comes as a pleasant surprise given a lot of controversy around the Troubled Asset Relief Program when it was approved.The profit so far has included $1.4 billion from Goldman Sachs, $1.3 billion from Morgan Stanley (NYSE: MS) and $414 million on American Express (NYSE: AXP), as well as between $100 million and $334 million in profit from the five other banks that have repaid the government, according to the Times report. It does not include $35 million from 14 smaller banks.The banks operating in the Dayton area that have paid back their TARP funds include U.S. Bancorp (NYSE: USB) and JPMorgan & Chase Co. (NYSE: JPM).The article cautions that the government has yet to be paid back by insurance giant American International Group (NYSE: AIG) or the automakers, General Motors and Chrysler.
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