Sun 29 Jan 2012
U.S. taxpayers are still owed $132.9 billion by companies that benefited from the financial bailout and haven’t fully repaid. Some of that money will never be recovered, a government watchdog said.
Big companies like General Motors and AIG, which benefited from the bailout, still owe U.S. taxpayers $132.9 billion. Some of that money will never be recovered, a government watchdog said.
Christy Romero, the acting special inspector general for the $700 billion bailout, has said the bailout that began in September of 2008, could actually last for several more years. Romero told The Associated Press that some bailout programs such as the effort to reduce home foreclosures will last up to 2017 and such programs could cost an additional $50 billion or more.
American International Group Inc., which is among the largest of the reported 458 bailed-out companies, owes approximately $50 billion. Other big names such as General Motors Co. and Ally Financial Inc. owe $25 billion and about $12 billion respectively.
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Following the 2008 financial crisis, Congress had authorized $700 billion for the bailout of financial companies and automakers. This is called Troubled Asset Relief Program, or TARP, and about $413 billion was lent out. The government has recovered approximately $318 billion, or about 77 percent of it so far, according to reports. The Treasury bailed out companies in the form of loans and converted its loans to some of the recipients into common shares in those companies.
Reports are that those shares are now trading below Treasury’s break-even prices.
“TARP is not over,” Romero noted in a statement to The AP.
A break down of some of what’s owed
Romero said 371 banks still owe money. Some of those banks are:
– Regions Financial Corp.: $3.5 billion;
– Zions Bancorporation: $1.4 billion;
– Synovus Financial Corp.: $967.9 million;
– Popular Inc.: $935 million;
– First Bancorp of San Juan, Puerto Rico: $400 million; and
– M&T Bank Corp.: $381.5 million.
The Star Tribune reported that Treasury spokesman Matt Anderson said that the department “has made substantial progress winding down TARP and has already recovered more than 77 percent of the funds disbursed for the program, through repayments and other income.”
He added that the department will “continue to balance the important goals of exiting our investments as soon as practicable and maximizing value for taxpayers.”