Treasury Department Revises TARP losses to $42B, down from $270B

The U.S. Treasury has revised it's losses on TARP according to the New York Times:

The Treasury Department expects to recover all but $42 billion of the $370 billion it has lent to ailing companies since the financial crisis began last year, with the portion lent to banks actually showing a slight profit, according to a new Treasury report.

The new assessment of the $700 billion bailout program, provided by two Treasury officials on Sunday ahead of a report to Congress on Monday, is vastly improved from the Obama administration’s estimates last summer of $341 billion in potential losses from the Troubled Asset Relief Program. That figure anticipated more financial troubles requiring intervention.

The officials said the government could ultimately lose $100 billion more from the bailout program in new loans to banks, aid to troubled homeowners and credit to small businesses.

It seems the report is only available to a special few, so we'll read it as soon as we get it.

But the $42B is a net estimate, taking into account profits made from TARP. (cough, cough).

Meanwhile Citigroup is making rumblings on wanting out of TARP yet the Treasury wants to link the Citigroup government stake sale with paying back the funds.

Recall we have an unknown quantity of funds distributed by the Federal Reserve.

Subject Meta: 

Forum Categories: