The Treasury Department announced Thursday it sold 272.17 million warrants it received from Bank of America (BAC) in return for its investment under the controversial $700 billion bailout fund, known as the Troubled Asset Relief Program [TARP].
The Treasury said it received a record $1.54 billion from the sale which is the largest amount raised from a single institution from the sale of warrants under TARP.
Treasury divided the Bank of America warrants into two classes: “A and B”. The first class of 150.4 million securities, which carried a minimum bid price of $7 per warrant, brought a price of $8.35 and the other group of 121.8 million securities — minimum bid price of $1.50 — brought a price of $2.35 to bring the total to $1.54 billion. BofA received $25 billion from the government’s TARP in October 2008 and another $20 billion in January 2009.
The auction was conducted by Deutsche Bank Securities Inc.
According to Reuters, the amount raised in the BofA auction exceeded the $936.1 million raised from a December auction of JPMorgan (JPM) warrants and the $1.1 billion raised from the sale of Goldman Sachs (GS) warrants.
Bank of America Corp. repaid the government $45 billion in December as part of its efforts to sever ties with the TARP fund.