- With 80 lenders still owing the government $2B from TARP financing they received during the financial crisis, 27 of them have until the end of next week to repay the loans or face an increase in interest rates.
- The quarterly dividend payment they would have to pay the Treasury is set to increase to 9% of the loan balance outstanding from 5%. The rise will hit another 32 banks by mid-May.
- Banks that are returning the money include Buffalo-based Crazy Woman Creek Bancorp (CRZY) and Virginia-based First Capital Bancorp (FCVA).
- However, other banks don't have the means to repay the loans just yet, increasing the risk that they might fail or have to sell themselves.