New Rules to Be Set for Banks’ TARP Exit

U.S. officials are preparing to release as soon as Wednesday guidelines for how banks can return billions in taxpayer bailout funds, Reuters reported on Tuesday citing sources familiar with administration thinking.

From Reuters: One key condition is expected to be that banks are able to participate in the credit markets without the help of government facilities, such as the Federal Deposit Insurance Corp’s debt guarantee program, the sources said…

The announcement of the conditions will closely coincide with Thursday’s public unveiling of the results of the government’s stress test on the 19 largest U.S. banks.

From Miami Herald: The new rules…allow for the return of the bailout funds under conditions that most banks aren’t likely to accept. A senior government official, speaking on the condition of anonymity because the program wasn’t yet public, said banks would have to give up a special loan guarantee program in the process.

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