The U.S. Department of the Treasury announced on Thursday that it plans to continue selling its shares of common stock in Ally Financial, which will further reduce the government's stake in the Detroit-based lender and recover more TARP investment funds for taxpayers.
Treasury now holds 75,065,340 shares of Ally common stock, which computes to about 16 percent.
The announcement of Treasury's sale of additional Ally common stock is "another step toward ultimately exiting the Troubled Asset Relief Program (TARP) and delivering additional value to shareholders, including the U.S. taxpayer," Ally spokeswoman Gina Proia said in a statement
Treasury began selling off its common stock in Ally back in April, when Ally's initial public offering (IPO) price of $25 per share resulted in $2.375 billion in proceeds for taxpayers.
“Treasury’s sale of additional Ally common stock is part of our continuing effort to wind down the Troubled Asset Relief Program,” Chief Investment Officer Charmian Uy said. “We will prudently exit the remaining Ally investment, balancing speed with maximizing returns for taxpayers.”
Following the sale of those 95 million shares in April, IPO underwriters later elected to buy an additional 7,245,670 shares of Ally common stock at the IPO price of $25 per share, which recovered taxpayers another $181 million. To date, about $17.8 billion of the government's original investment through TARP to assist Ally has been recovered for taxpayers – which is approximately $650 million more than the original $17.2 billion investment.
Taxpayers have recovered a total of $439.8 billion from TARP investments to date, a number that includes the sale of Treasury's American International Group (AIG) shares completed in December 2012. By comparison, $424.8 billion has been disbursed for TARP.