Among the things that the Treasury Department elects to say very little about is how many of the firms that still owe the government TARP money are not even paying interest on the capital they have loaned. The complete list of companies and their repayment status is posted at the financialstability.gov site .
A recent report by SNL Financial LC shows that “Seventy-four institutions missed the dividend due Feb. 16 on the preferred stock issued under the Troubled Asset Relief Program.”
It is probable that some of these banks will eventually be closed by the FDIC and state banking authorities. The FDIC has already gotten member firms to prepay their fees through 2012 so that it can avoid borrowing mony from the Treasury. However, several hundred more banks could close this year. That means the FDIC may still have to tap Treasury funds later in 2010 or early in 2011.
Four banks were shuttered by the FDIC this weekend bringing the total number to 37 since the beginning of this year. Ellijay, Ga.-based Appalachian Community Bank, Hiawassee, Ga.-based Bank of Hiawassee, Fort Deposit, Ala.-based First Lowndes Bank and Aurora, Minn.-based State Bank of Aurora were all closed. The four bank failures will cost the deposit-insurance fund $599.5 million, according to the Federal Deposit Insurance Corp, according to MarketWatch.
Douglas A. McIntyre
Top Gaining Stocks
Top Losing Stocks