Wells Fargo & Co and Citigroup Inc repaid a total of $45 billion to the United States, as major banks look to reduce government influence over their affairs.
San Francisco-based Wells Fargo repaid in full the $25 billion it received in October 2008 under the government’s Troubled Asset Relief Program. Citi repaid $20 billion, but taxpayers still own common stock in the bank that is now worth about $25.2 billion.
The banks were the last two major banks left in TARP. Most of their competitors repaid the United States in June.
Exiting TARP gives banks more say over areas including employee compensation and dividends.
Last week, Wells Fargo sold $12.25 billion in stock and New York-based Citigroup sold $17 billion in common shares and $3.5 billion in convertible notes to help repay the TARP money.
In almost every case, taxpayers/Treasury made a direct profit on the repayment. Citibank shares will have to rebound – and then the US government will sell taxpayer shares – to realize that profit.