TARP cost estimate grows by $10 billion in one year
The estimated cost of Troubled Asset Relief Program transactions through the third quarter increased to $28 billion, the Government Accountability Office said Thursday. The GAO raised its estimate from $18.5 billion in January for all transactions that took place through the third quarter of 2010. From 2008 through Oct. 3, 2010, the Treasury Department invested $245 billion in banks and $80 billion into the auto industry. The $28 billion cost through the third quarter does not include the committed $29 billion to housing initiatives, such as the Home Affordable Modification Program. It has so far actually spent $2.8 billion through the housing programs. The increase in TARP costs from last year, according to the GAO, is due to declines in the value of investments the Treasury still has in Ally Financial (GJM), General Motors (GM) and American International Group (AIG). As of the third quarter, the Treasury still had $122.4 billion in outstanding direct loans and equity investments under TARP, valued at roughly $80 billion. Write to Jon Prior. Follow him on Twitter @JonAPrior.