Treasury Purchases $46 Million of Preferred Stock
The US Treasury Department invested another $45.5m in seven financial institutions through the Capital Purchase Program (CPP), Treasury reported this week. The one publicly-traded institution to participate in the daily transaction, Village Bank and Trust Financial Corp. (VBFC), received $14.74m. The second-largest infusion of the day, $10.75m, went to Security State Bank Holding Co. Ohio-based CenterBank received the smallest daily transaction of $2.25m. The Treasury so far funded $199bn in total capital purchases and received only $1.04bn in returned funds from 11 firms as of April 22. The Treasury still retains preferred stock for the remaining purchases. These are the same stocks the government suggested major US banks could convert to common shares in order to raise capital needed under the recent stress tests. The Treasury also announced this week another addition to the servicers funded for modification incentives by the TARP through its Making Home Affordable Modification Program. Aurora Loan Services joined the growing list as the 14th servicer with $798m for lender/investor, servicer and borrower incentives to participate. See the latest TARP transaction report. Write to Diana Golobay. Disclosure: The author held no relevant investment positions when this story was published. Indirect holdings may exist via mutual fund investments.