Treasury Set to Appoint Board Members at TARP-Delinquent Banks
Tweet
Share
E-mail
According to FOX Business Network’s Elizabeth MacDonald, the U.S. Treasury is getting ready to appoint board members to TARP-funded banks that have missed dividend payments.
All of the banks are smaller community banks that are what MacDonald called “dead beats,” due to the delinquency of their payments.
Under the terms of the Troubled Asset Relief Program, banks that took taxpayer bailout funds and have missed six consecutive dividend payments to the Treasury will be saddled with a government-appointed member to their board of directors.
"We are considering various options on how to properly exercise our contractual rights so to best protect the taxpayer's interests," Treasury spokesman Mark Paustenbach said a few weeks ago.
Currently, only California’s Siagon National Bank has met this level of delinquency, but MacDonald said that there may be as many as eight more that are coming close.
“If these TARP bank bailout companies miss six dividend payments, then they will face Treasury-appointing from the private sector to the board of directors,” MacDonald said. “We are seeing 105 banks are on the Treasury’s radar screen for a possible intervention here. They are certainly on the radar screen for missing a number of dividend payments.”
At this point it is unclear how active the board members will be once put into place.
“We don’t know how active those boards of directors would be,” MacDonald added. “You see continuously this looping back of the interventions with TARP bailout money and relationships to Congress and now they’re not paying to the taxpayer the dividends the Treasury says they owe.”
All of the banks are smaller community banks that are what MacDonald called “dead beats,” due to the delinquency of their payments.
Under the terms of the Troubled Asset Relief Program, banks that took taxpayer bailout funds and have missed six consecutive dividend payments to the Treasury will be saddled with a government-appointed member to their board of directors.
"We are considering various options on how to properly exercise our contractual rights so to best protect the taxpayer's interests," Treasury spokesman Mark Paustenbach said a few weeks ago.
Currently, only California’s Siagon National Bank has met this level of delinquency, but MacDonald said that there may be as many as eight more that are coming close.
“If these TARP bank bailout companies miss six dividend payments, then they will face Treasury-appointing from the private sector to the board of directors,” MacDonald said. “We are seeing 105 banks are on the Treasury’s radar screen for a possible intervention here. They are certainly on the radar screen for missing a number of dividend payments.”
At this point it is unclear how active the board members will be once put into place.
“We don’t know how active those boards of directors would be,” MacDonald added. “You see continuously this looping back of the interventions with TARP bailout money and relationships to Congress and now they’re not paying to the taxpayer the dividends the Treasury says they owe.”
You May Also Be Interested In
- Kayne Anderson prices $65M private placement of notes and shares
- AptarGroup (ATR) Declares $0.48 Quarterly Dividend; 1.4% Yield
- South Plains Financial Inc. (SPFI) Raises Quarterly Dividend 5.9% to $0.18; 1.6% Yield
Create E-mail Alert Related Categories
Insiders' Blog, Trader TalkRelated Entities
DividendSign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!
