The U.S. Department of Treasury announced that is recovered $22 million for taxpayers through the sale of First BanCorp common stock earlier this week, and that it planned to sell additional stock in the San Juan, Puerto Rico-based bank.
Treasury is selling its common stock in First BanCorp as part of an ongoing effort to wind down the government's Troubled Asset Relief Program (TARP) to bail out banks devastated by the financial crisis of six years ago. First BanCorp received about $400 million from Treasury in 2009 as part of the TARP bailout.
According to a press release from Treasury, the agency sold nearly 4.4 million shares of common stock as part of a pre-defined written trading plan earlier this week, resulting in a gain of $22 million for American taxpayers. Treasury holds about 7.2 percent of First BanCorp common stock, which calculates to nearly 15.3 million shares. Treasury said it plans to sell more shares of common stock in First BanCorp through a second written trading plan.
Signed into law by the Bush administration, TARP was created in 2008 at the height of the nation's financial crisis in order to implement programs to stabilize the financial system during the financial crisis of 2008. Treasury originally outlined a strategy for winding down its remaining TARP bank investments in May 2012 "in a way that protects taxpayer interests and preserves the strength of our nation's community banks," according to Treasury. The strategy to recover Treasury's investments includes using a combination of repayments, restructurings, and sales.
To date, Treasury's efforts have resulted in taxpayers recovering $440.4 billion in TARP investments, about $14 billion more than the $426.3 billion disbursed. Only 34 out of 707 banks that received TARP investments through the Capital Purchase Program remain in the program. In late November, Treasury eliminated three banks from that list by auctioning off a combined 68,000 shares of common stock in the three institutions for a gain of $35.6 million in aggregate gross proceeds.