The Treasury should be standing there with “arms wide open” to accept any of the TARP money a bank wants to pay back. Our government charter does not extend to the bailout of private enterprise entities, bank, automotive company or any other. However, we have allowed it and now that the funds have been disbursed, every effort should be made to get them back. That may be the intent of our Treasury but it doesn’t feel that way based on the way it is reported. (link to WSJ article below)
Related point: I am working a business turnaround situation with a client whose bank is a TARP bank. You would never know the bank has accepted money intended on helping business move forward. We have a valid business moving forward plan where the bank does not even have to advance any more funds. However the cooperation of the bank is required. They have chosen not to cooperate. I am told by other professionals working with companies and with TARP money banks that the attitude from the banks of not really helping is pervasive.
So the we allow the government to bail out these banks and the money is not being used to really help the economy. Amazing.
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Here is today’s Wall Street Journal Article.
from The Wall Street Journal
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The Treasury Department said it will allow 10 of the nation’s largest banks to repay $68 billion in government bailout money.
The Treasury says the banks will be allowed to repay the money they received from the $700 billion Troubled Asset Relief Program funds. The banks have been eager to get out of the TARP program to escape government restrictions such as caps on executive compensation.
The Treasury Department did not name the banks involved, but Morgan Stanley said it is repaying $10 billion in TARP capital.