Hmmm ... that looks like a job for Tim Fowler, he likes wading through that stuff. I've no patience with financial docs because there is too much 'this is good' oh but 'that is pretty bad' yet 'on the positive side' blah blah blah
like here... I just skipped to the concluding comments:
Despite the healthy returns from the CPP and the TIP, the Treasury's profit has been hampered by losses. The Treasury declared a full loss on its $2.3 billion and $4.1 million investments in CIT Group Inc. and Pacific Coast National Bank, respectively. CIT filed for bankruptcy Nov. 1, 2009, and Pacific Coast National's unit was placed into receivership by the FDIC on Nov. 13, 2009. The Treasury will also likely soon declare its losses on the Nov. 6, 2009, failure of UCBH Holdings Inc., which received $298.7 million in TARP funds.
As banks continue to fail, TARP participants will likely be among them, which will further increase Treasury losses. As of Dec. 31, 2009, at least 28 bank holding companies with approximately $1.9 billion in TARP funds had adjusted Texas Ratios of more than 100%. The adjusted Texas Ratio indicates a bank's ability to absorb losses by measuring nonperforming assets and loans 90 days past due, excluding government guaranteed loans, as a percentage of tangible equity and reserves.
Furthermore, 74 TARP participants have missed February's dividend payment.
The U.S. government estimated the costs of the CPP and the TIP, along with the other TARP programs, in a recent analysis by the Congressional Budget Office. The report released March 17 estimates a gain of approximately $5 billion from the CPP and the TIP over the life of the programs, based on data calculated on a net present value as of Feb. 17.
A March 2 report by the Treasury puts the net return at approximately $17 billion for the two programs on a present-value basis, as of Sept. 30, 2009.
The CBO report notes that together, all the TARP programs will ultimately cost taxpayers' money. The CBO report projects a total price tag of $109 billion for TARP, which includes the investments in the automobile industry and AIG. The estimate has decreased significantly from the CBO's prior-year March estimate of $356 billion. |
