Today Interim Assistant Kashkari defended the TARP program claiming that progress is being made and then proceeds to hand out an additional $1.5 billion to 15 banks.
On October 24th, $250 billion was allocated to help ailing banks in which an estimated $151 billion has been disbursed to 52 institutions in 25 states across the country. When it comes to measuring the results of how the TARP program has worked Kashkari responded by saying that the Treasury did not allow the financial system to collapse and that the average credit default swap spread for the eight largest U.S. banks, which has declined almost 207 basis points.
Kashkari also stressed that changes will not happen overnight and that it may be months before we see banks making new loans. Another important factor is that consumer confidence is still low, and while confidence remains low banks will continue to be catious about extending credit.
“This lending won't materialize as fast as any of us would like, but it will happen much faster as a result of having used the TARP to stabilize the system and to increase the capital in our banks,” said Kashkari.
Meanwhile, the Treasury approved an additional $1.5 billion, on top of the $151 billion already disbursed, to 15 banks across the country. Colonial Bancorp Group Inc. of Montgomery Alabama was the biggest beneficiary receiving $550 million in preffered shares to the government. Other institutions receiving a piece of the $1.5 billion in government relief include SVB Financial Group, United Bankshares Inc., Sterling Bancshares Inc., Park National Corp, Bank of the Ozarks Inc., Flushing Financial Corp., StellarOne Corp., The First Bancorp, Bank of Marin, First California Financial Group Inc., Oak Valley Bancorp, Security California Bancorp, Commerce National Bank and Connecticut Bank and Trust Co.
Keep updated on current mortgage news by visiting Future Planning Financial at www.fpf-direct.com.
Comment and add to the story without registration, but keep the comments meaningful please. Links are not accepted.
