Banks Returning TARP Money

On the day that the first quarter of 2009 ended, three banks became the first in the nation to say "Thanks, but no thanks" to the Treasury Department and return the money the Treasury Department had provided them through the TARP (Troubled Assets Relief Program). One even cited the limits on executive pay including in the stimulus bill as a reason for paying back the money.

Louisiana's Iberia Bank returned $90 million. Daryl G. Byrd, President and Chief Executive Officer said in a release, "We are pleased to be among the first financial institutions to pay back the Treasury's TARP investment."

Signature Bank in NY returned $120 million. Scott Shay, Chairman of the Board of the bank said in a statement, "We are pleased that as one of the most well-capitalized institutions in the country, Signature Bank is among the first to repurchase the preferred shares it issued as part of the U.S. Department of Treasury's Capital Purchase Program, and the funds can now be recycled to those institutions that need the funds.

And the President and CEO of the bank, Joseph DePaolo, cited the restrictions on executive pay in the stimulus package for why the bank gave back the money. "The revised, expanded legislation included in the American Recovery and Reinvestment Act of 2009, passed on February 17, 2009, adversely affected our business model and it became apparent that we should return these funds to the Treasury. The return of these funds allows us to continue to execute our business model, which includes the successful recruitment and retention of highly talented banking professionals throughout the metropolitan New York area."

Finally, Old National Bancorp of Evansville, In., said it had returned its $100 million to the Treasury. The bank said that prior to making the decision, it worked with an outside firm to perform a stress test similar to the one the Treasury Department is requiring of the nation’s largest banks. "Based on the results of the stress test, the Company believes that it's well positioned to withstand current and future economic challenges," the bank said in a statement. - ABC News

This is what you get when you let the Democrats go off in an uproar and start passing 90% Tax Bills. Not everyone is AIG and when you throw a big blanket over everyone you catch good fish with the bad.