Daniel Gross

Three Transactions Return $562 m in TARP Funds

Even for the small fraternity of wonks who venture deep into the weeds of the Trouble Asset Removal Program, the Public-Private Investment Program is pretty obscure territory. The PPIP was one of the smaller, satellite bailout programs set up in the spring of 2009. The idea behind PPIP was that Treasury would invest money in — and lend money to — vehicles created by private investment firms that would purchase securities and assets from banks and other troubled financial institutions. That would coax money off the sidelines and help speed the removal of junky stuff from banks' balance sheets. Ultimately, Treasury committed $17.81 billion to nine funds, with $11.75 billion in debt and $6.06 billion in equity. The private funds in turn brought more than $7 billion of their own cash to the table, and then bought securities. Over time, as securities have matured, or been sold, or thrown off interest, the funds have returned money to Treasury. The pace has been much slower than the return of capital through other TARP components like the Capital Purchase Program.

However, this week, three funds returned a total of $562 million

The Invesco Legacy Securities Master Fund, into which Treasury originally put $1.16 billion, has been the fastest to pay back cash. On March 14, it sent $284.468 million to Treasury, which means it has returned all the public capital that went in.

On March 14, the AG GECC PPIF Master Fund, to which PPIP had committed $2.486 billion, returned $198.9 million in capital, leaving with $2.133 billion.

Also on March 14, the Oaktree PPIP Fund, into which PPIP committed $2.32 billion, returned $78.775 million.

Altogether, the three transactions returned $562 million.

Daniel Gross is economics editor at Yahoo! Finance

Follow him on Twitter @grossdm; email him at grossdaniel11@yahoo.com

View Comments (1)