Report: Bailed-out companies still owe $133B
By
Marcy Gordon and Daniel Wagner
WASHINGTON — Companies bailed out during the financial crisis still owe U.S. taxpayers nearly
$133 billion, and the Treasury’s plans to recoup that money have been slowed by the volatile stock
market and weakness among smaller banks.
Some of the money will never be recovered.
That’s the conclusion of the acting inspector general for the government’s financial bailout.
Some bailout programs, such as the effort to reduce home foreclosures, will last as late as 2017,
the inspector general said. Those programs could cost an additional $50 billion or more.
After the 2008 financial crisis, Congress authorized $700 billion for the bailout of financial
companies and automakers via the Troubled Asset Relief Program, or TARP. About $413 billion was
lent. So far, the government has recovered about $318 billion, or about 77 percent.
“TARP is not over,” Christy Romero, the acting inspector general, said in a statement.
Among the largest bailed-out companies, American International Group Inc. still owes taxpayers
about $50 billion, General Motors Co. owes about $25 billion and Ally Financial Inc. about $12
billion.
The 371 banks that still owe money include Regions Financial Corp., which owes $3.5 billion;
Zions Bancorporation, $1.4 billion;
Synovus Financial Corp., $967.9 million; Popular Inc., $935 million; and First Bancorp of San
Juan, Puerto Rico, $400 million.
The Treasury Department bailed out companies with loans. It converted its loans to some of the
biggest recipients into common shares in those companies. Those shares are now trading below
Treasury’s break-even prices.
For Treasury to sell its stock in the largest recipients at the price where taxpayers would
break even — $28.73 a share for AIG, $53.98 for GM — it could take years, the report says. AIG’s
shares closed yesterday at $25.14. GM ended at $24.72. Ally isn’t publicly traded.
Article source: http://www.dispatch.com/content/stories/national_world/2012/01/27/report-bailed-out-companies-still-owe-133b.html