CCH Financial Reform News Center

SIGTARP Issues Report on Sale of TARP Warrants

By Gregg D. Killoren, J.D., CCH State Banking Law Reporter, Bank Digest and Individual Retirement Plans Guide.

The Office of the Special Inspector General for the Troubled Asset Relief Program (SIGTARP) has released an audit report assessing the Treasury Department's process to sell warrants received from Troubled Asset Relief Program (TARP) recipients. Under the Emergency Economic Stablization Act of 2008, the Treasury Department received warrants or debt instruments for every investment it made in under TARP. The warrants provide the Treasury the option of purchasing common stock of the publicly-held financial institution that received TARP funds at a predetermined price. As the recipient institutions repay the TARP funds, the Treasury sells the warrants either directly to the recipient institution or through a public auction. The audit seeks to determine: (1) the process and procedures the Treasury has established to ensure that the government receives fair market value for the warrants; and (2) the extent to which the Treasury follows a consistent and well-documented process in reaching its decision to sell warrants back to recipient institutions.

Treasury Announces Public Offering of Comerica Common Stock Warrants

This story appeared in Bank Digest.

The Treasury Department has announced the commencement of a secondary public offering of 11,479,592 warrants to purchase the common stock of Comerica Incorporated. Deutsche Bank Securities Inc., in its role as auction agent, announced that the offering will be made through a modified Dutch auction that will commence at 8 a.m., Eastern Time, on May 6, 2010, and will close at 6:30 p.m., Eastern Time, on the same day. During the auction period, potential bidders for the warrants will be able to place bids at any price—in increments of $0.10—at or above the minimum bid price of $15 per warrant.

Public Offering of PNC Common Stock Warrants Announced

This story appeared in Bank Digest.

The Treasury Department has announced that it has commenced a secondary public offering of 16,885,192 warrants to purchase the common stock of The PNC Financial Services Group, Inc. The proceeds of these sales will provide an additional return to the American taxpayer from Treasury's investment in PNC beyond the dividend payments it received on the related preferred stock. The offerings will be made through a modified Dutch auction. Deutsche Bank Securities Inc. is the sole book-running manager and Muriel Siebert & Co., Inc., CastleOak Securities, L.P., and M.R. Beal & Company are the co-managers for the offerings.

Treasury Announces Intent to Sell Warrant Positions in Public Dutch Auctions

This story appeared in Bank Digest.

The Treasury has announced its intention to dispose of several warrant positions received in consideration for investments made under the Capital Purchase Program. Over the next six weeks, Treasury intends to conduct auctions to sell its warrant positions in Wells Fargo & Co., PNC Financial Services Group, Inc., Comerica Inc., Valley National Bancorp, Sterling Bancshares, Inc. and First Financial Bancorp. Treasury intends to sell the warrants through public offerings. These offerings will be executed using a modified Dutch auction methodology that establishes a market price by allowing investors to submit bids at specified increments above a minimum price specified for each auction.

Treasury Releases Latest Capital Purchase Program Transactions

This story appeared in Bank Digest.

The Treasury Department has released the latest transactions completed under its Capital Purchase Program (CPP). As of April 7, 2010, the Treasury has received $135,839,721,000 in capital repayments which brings the Treasury’s CPP investment amount to $66,725,489,320. In addition, $4,397,678,195 in warrant proceeds have been repurchased by financial institutions or sold by the Treasury as part of a registered public offering of the warrants issued by the financial institution.

Pricing of Texas Capital Bancshares Warrants Announced

This story appeared in Bank Digest.

The Treasury Department has announced that it has priced a secondary public offering of 758,086 warrants to purchase common stock of Texas Capital Bancshares, Inc. at $8.85 per warrant. The aggregate net proceeds to the Treasury Department from the offering are expected to be $6,559,066. These proceeds provide an additional return to the American taxpayer from Treasury Department's investment in the Texas Capital Bancshares beyond the dividend payments it received on the related preferred stock. The closing is expected to occur on or about March 17, 2010, subject to customary closing conditions. The offering was priced through a modified Dutch auction. Deutsche Bank Securities Inc. was the sole book-running manager for the offering.

Treasury Releases Latest Capital Purchase Program Transactions

This story appeared in Bank Digest.

The Treasury Department has released the latest transactions completed under its Capital Purchase Program (CPP). As of March 11, 2010, the Treasury has received $130,179,721,000 in capital repayments making the Treasury's total CPP investment amount $72,385,489,320. In addition, $4,373,190,148 in warrant proceeds have been repurchased by financial institutions or sold by the Treasury as part of a registered public offering of the warrants issued by the financial institution.

Treasury Prices Signature Bank Warrants

This story appeared in Bank Digest.

The Treasury Department has announced the pricing of a secondary public offering of 595,829 warrants to purchase common stock of Signature Bank at $19.00 per warrant. The aggregate net proceeds to Treasury from the offering are expected to be $11,150,940. The closing is expected to occur on or about March 16, 2010, subject to customary closing conditions.

Treasury Announces Pricing of Public Offering of Warrants

This story appeared in Bank Digest.

The Treasury Department has announced that it priced a secondary public offering of 1,707,456 warrants to purchase common stock of Washington Federal, Inc., at $9.15 per warrant. The aggregate net proceeds to the Treasury from the offering are expected to be $15,388,874. These proceeds provide an additional return from the Treasury's investment in the company beyond the dividend payments it received on the related preferred stock. The closing is expected to occur on or about March 15, 2010, subject to customary closing conditions.

Public Offering of Warrants to Purchase Common Stock

This story appeared in Bank Digest.

The Treasury Department has announced the public offerings of warrants to purchase common stock of Washington Federal, Inc., Signature Bank and Texas Capital Bancshares, Inc. The proceeds of these sales are intended to provide an additional return to the American taxpayer from Treasury's investment in Washington Federal, Signature Bank and Texas Capital beyond the dividend payments it received on the related preferred stock.