Posts Tagged ‘TARP’
3Q09 FUNdamental Facts
- Banks want to pay off their TARP (Troubled Assets Relief Program) IOUs to escape federal pay restrictions, but still profit from taxpayer-funded guarantees on their debts.
- None of the players are talking about the Federal Deposit Insurance Corporation bond-guarantee program which benefits them more than TARP.
- They don’t want federal interference but want the benefits of government liquidity programs.
- These institutions probably save about 2% in annual interest costs by issuing debt under the FDIC-sponsored TLGP (Temporary Liquidity Guarantee Program). For all of the players, this could be $7 billion per year.
- Following are the names of the key players, their TARP IOU and the amount of bonds guaranteed by the FDIC (all in billions) : Citigroup ($50,$27), Bank of America ($45,$44), JP Morgan ($25,$38), Wells Fargo ($25,n/a), Goldman ($10,$29), Morgan Stanley ($10,$24), GE Capital ($0,$37).
Asset Strategies Portfolio Services, Auburn Hills, Michigan provides quarterly market facts. See all services offered at www.assetstrategie.com
