TARP Winding Down as BofA Says It Will Repay Aid
Secretary Geithner recently said that the Administration will outline its exit strategy for TARP in the next few weeks, but the expiration date has still not been set. He recently stated that they were “close to the point where we can wind down this program and stop making new commitments,” but that they were “not quite there yet.”
This has come at the same time that Bank of America reported that it will repay all $45 billion in federal aid it has received since October 2008. Through TARP, the government provided $25 billion in capital infusions through the Capital Purchase Program in October 2008 and early January 2009 and provided an additional $20 billion through the Targeted Investment Program in mid-January 2009, at a total estimated cost to the government of $6.5 billion.
However, the $45 billion in government aid understates the complete scope of support provided to Bank of America. As part of a multi-agency effort, the Federal Reserve, FDIC, and Treasury have guaranteed approximately $118 billion in Bank of America assets.
Visit Stimulus.org for more information and associated costs to the government from TARP and its sub-programs.