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Banks talking to U.S. about TARP repayments: official
WASHINGTON (Reuters) - U.S. banking supervisors have received requests from several major banks to repay emergency government investments, a Federal Reserve spokesperson said on Tuesday.
Supervisors are talking to banks that took money under the Treasury Department's Troubled Asset Relief Program about the repayment process, the official said. Any announcements on returning TARP funds would not come until around June 8, the official added.
The banks that are asking to repay TARP funds are among the 19 institutions that submitted to government stress tests to determine their ability to withstand a sharp economic downturn, the official said.
Bank supervisors are seeking additional information from the banks and will make recommendations to the Treasury Department on whether to approve the repayments, said the Fed spokesperson.
Those recommendations will be made in batches, not one-by-one, and going forward, supervisors will make recommendations to the Treasury about repayments on a monthly basis, the spokesperson added.
The government made the emergency payments to banks to ensure they would have sufficient capital to continue lending during one of the most difficult recessions in decades.
Officials have expressed concern that some banks, in their eagerness to cut the government support line that comes with conditions, may want to return the funds too soon.
(Reporting by Mark Felsenthal; Editing by Andrea Ricci)
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