Troubled Assets Relief Program (TARP)

Sydney Morning Herald  Feb 18  Comment 
Man thought he saw "kids moving" under tarp in back of car on same road where slain schoolboy Daniel Morcombe was last seen, court told.     
Wall Street Journal  Feb 6  Comment 
Ally Financial said fourth-quarter profit plunged after settling federal allegations of lending discrimination and taking several steps to exit the mortgage business. CEO Michael Carpenter expects Ally to exit the TARP program by the end of 2014.
Wall Street Journal  Feb 5  Comment 
Small banks across the U.S. are facing a crunchtime decision over federal aid received during the financial crisis: repay the funds soon or face a steeper interest-rate bill.
Benzinga  Jan 15  Comment 
In a report published Wednesday, Morgan Stanley analyst Ken Zerbe reiterated an Underweight rating on Popular (NASDAQ: BPOP), with a price target of $24.00. According to the report, BPOP could eventually announce that it has received approval...
DailyFinance  Jan 2  Comment 
MANISTIQUE, MI -- (Marketwired) -- 01/02/14 -- Mackinac Financial Corporation (NASDAQ: MFNC), the bank holding company for mBank (the "Bank"), today announced that on December 31, 2013, it completed the redemption of its remaining 4,000 shares of...
Benzinga  Dec 31  Comment 
Northwest Bancorporation (OTC: NBCT) announced today the redemption on December 31, 2013 of all remaining shares of its outstanding Fixed Rate Cumulative Perpetual Preferred Stock, Series A ("Series A Preferred Stock") and Fixed Rate Cumulative...  Dec 31  Comment 
NEW YORK (TheStreet) -- United Community Banks announced a lovely year-end present for its common shareholders Monday, which could provide quite a boost for the shares.United Community of Blairsville, Ga. announced it had repurchased $75 million...



Read more about the 2008 Financial Crisis.

The Troubled Assets Relief Program (TARP) is a facility created by the US Government to buy distressed assets from financial institutions in response to the 2008 Financial Crisis. The program was created through the Emergency Economic Stabilization Act of 2008 and is managed by the Office of Financial Stability at the US Treasury. The TARP was initially designed to buy distressed mortgage-backed securities from financial institutions but evolved to encompass corporate debt and equity injections into banks.

The Emergency Economic Stabilization Act of 2008, enacted on October 3, 2008, allows the Treasury to spend up to $700 billion on this program. The Treasury is allowed to draw up to $250 billion immediately after the enactment, then requires the President to certify an additional $100 billion; another $350 billion are subject to further Congressional approval.[1]

The original idea behind TARP was to create liquidity in the credit markets by buying (and freeing up) assets tied to mortgages from banks -- hence allowing them to continue lending. However, on October 13, 2008, the Treasury announced that it was going to take equity stakes in nine major banks and encouraged smaller banks to apply for equity injections.

Institutions which participate in this program will be subject to more oversight from the government and would have to limit executive compensation.

On November 12, 2008, Treasury Secretary Henry Paulson announced that no TARP funds would be used to purchase troubled assets.


  1. Economic rescue swiftly signed into law. AFP (2008-10-03).
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