U.S. Profits from Bailed-Out Banks

The U.S. government has already retrieved about $4 billion in profits from 8 of the biggest banks that have fully repaid their obligations from the $700 billion Troubled Asset Relief Program (TARP).

The government has recorded profits of about $1.4 billion from its investment in Goldman Sachs Group Inc. (GS - Snapshot Report), $1.3 billion from Morgan Stanley (MS - Snapshot Report) and $414 million from American Express Company (AXP - Analyst Report).

Furthermore, the government has also reaped profits in the range of $100 million to $334 million from its investments in each of the following five banks: Northern Trust Corporation (NTRS - Snapshot Report), The Bank of New York Mellon Corporation (BK - Snapshot Report), State Street Corp. (STT - Snapshot Report), US Bancorp (USB - Analyst Report) and BB&T Corp. (BBT - Analyst Report). It also collected about $35 million in profits from 14 smaller banks that have paid back their loans.

TARP was introduced in October 2008 to rescue the struggling banking industry, which was facing massive losses due to the sub-prime mortgage crisis and housing collapse. The payback of the bailout money by the above-mentioned banks has triggered optimism that the U.S. government may soon get out of the banking business. Earlier, taxpayers were doubtful of reaping any profits under the program, and were concerned that it could take years for the banks to repay the loans.

However, government money is still locked in some very big companies like Citigroup Inc. ([[C]] - Analyst Report), Bank of America Corporation (BAC - Analyst Report), insurance giant American International Group Inc. (AIG - Snapshot Report), mortgage lenders Fannie Mae (FNM - Snapshot Report) and Freddie Mac (FRE - Analyst Report), and automakers General Motors and Chrysler. Repayment of TARP money from these companies remains uncertain.

Comments

[fed_alchemy:]

If they did it right , Healthcare/Social Security would be funded today...
but....put it thru the spin cycle and you still cant get those toxic assets clean.

Aug 31 07:12 PM

[Mark Bern:]

Do not count me among those who remain optimistic that the government will be getting out of either the banking or automotive businesses anytime soon.

Caveat: Unless all of the companies mentioned in the last paragraph of the article go out of business.

Aug 31 08:52 PM

[PainfullyAware:]

Government "Made Money" from the "Magic Money Fountain" of the fiat money system and the implementation of the "Shell Game" by its select TARP Banks.

4 billion to date => 4.1667 billion per year => Only 336 Years to Go Until TARP PAYBACK => Only 2880 Years To Go Until Pay Back on The 12 Trillion.

Yes the rate could increase but it is doubtful that it would by "Honest Business".

If This Is "Making Money", Then The Government Sucks At It.

Sep 01 03:21 AM

[whisperonth...:]

PainfullyAware, the government doesn't make money, it takes money. It doesn't earn money because it doesn't work.

Sep 01 09:34 AM

[PainfullyAware:]

On Sep 01 09:34 AM whisperonthewind wrote:

> PainfullyAware, the government doesn't make money, it takes money.
> It doesn't earn money because it doesn't work.

Things Have Become "A Bit More Grey" than your definitive "Government Does Not Make Money".

Congress Abdicated its responsibility for "Coining Money" To A Private Entity - The Federal Reserve - which does "Make Money";. Not for the benefit of the citizen but for the benefit of the "Club".

I agree that Government only leaches and does not "Provide Value With Recourse Or Reciprocity For Failure" In Regard To "Money Creation".

However, Fiat Monetary Policy and Fractional Reserve Banking DOES Create Money. (even If It Is Fictitious and Not Tied To Any Finite Quantity.)

Sep 01 10:56 PM