Banks get $285m in TARP funds
WASHINGTON - The Treasury Department has provided $284.7 million to 22 banks in the latest payments from the government's $700 billion financial rescue fund.
The government is buying preferred stock in banks as a way to bolster their balance sheets in hopes of getting them to resume more normal lending. With the new payments, the government said yesterday it has spent $197 billion on this part of the bailout.
The smallest payment in the latest round was $500,000 to Community Bancshares of Kansas Inc. of Goff, Kan. The purchase program for preferred shares of bank stock has provided support to 489 institutions in 47 states and Puerto Rico.
The purchase of bank stock is expected to use $250 billion of the first half of the rescue fund. Congress has authorized President Obama's administration to use the second $350 billion of the fund. The administration has promised to attach more strings to the assistance than the Bush administration did, but has not said how much of the fund will be used for bank stock purchases.