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 Treasury Completes Auction to Sell Warrant Positions



WASHINGTON The U.S. Department of the Treasury today announced that it completed an auction to sell its warrant positions in nine financial institutions in private transactions.  The auction was used to determine the clearing price for each warrant.
Financial Institution
Gross Proceeds
Underlying Shares
BBCN Bancorp, Inc.
City Holding Company
CommunityOne Bancorp
F.N.B. Corporation
F.N.B. Corporation
Fidelity Southern Corporation
First United Corporation
HMN Financial, Inc.
The First Bancorp, Inc.
Valley National Bancorp


The aggregate gross proceeds to Treasury from these transactions are expected to be approximately $50.9 million.  These institutions have either repaid Treasurys preferred stock or Treasury has already sold its investment in these financial institutions.  These proceeds provide an additional return to the taxpayer from Treasurys investment in these financial institutions beyond the repayment or sale proceeds and dividend payments it received on the related preferred stocks.  The closings are expected to occur on or about May 28, 2015, subject to customary closing conditions.
Treasury did not sell its warrant positions in M&T Bank Corporation, Synovus Financial Corp., or a second warrant position in BBCN Bancorp, Inc. due to the fact that Treasury did not receive bids above the minimum price for those warrant positions in accordance with the auction procedures. Treasury set a minimum price for each of the securities as part of the auction in order to protect taxpayer interests.
The auctions are part of the overall strategy that Treasury outlined for winding down its remaining TARP bank investments in a way that protects taxpayer interests, promotes financial stability, and preserves the strength of our nations community banks. Treasury indicated that it intends to use a combination of repayments, restructurings, and sales to manage and recover those remaining investments.
Taxpayers have recovered $275 billion to date from TARP’s bank programs through repayments, dividends, interest, and other income – compared to the $245 billion initially invested.  Approximately $2 billion of the repayments were refinanced under the Small Business Lending Fund (SBLF). Congress created the SBLF outside of TARP and required Treasury to let CPP institutions repay TARP funds by borrowing under that program. Treasury has remaining outstanding CPP investments in 30 institutions. For more details on Treasury’s lifetime cost estimates for TARP programs, please visit Treasury’s Monthly 105(a) Report to Congress on TARP here.
The warrants sold in the auctions have not been, and will not be, registered under the Securities Act of 1933, as amended (the Act), and may not be offered or sold in the United States or to, or for the benefit of, U.S. persons absent registration under, or an applicable exemption from, the registration requirements of the Act and applicable state securities law.  The warrants will be offered only to (1) qualified institutional buyers as defined in Rule 144A under the Act, (2) certain institutional accredited investors as defined in Rule 501(a) under the Act that have total assets of not less than $25,000,000 and (3) in certain cases, certain directors and executive officers of the respective issuers of the warrants.  This press release does not constitute an offer to sell or the solicitation of an offer to buy the warrants or any other securities (including the underlying shares of common stock), and shall not constitute an offer, solicitation or sale in any jurisdiction in which, or to any persons to whom, such offering, solicitation or sale would be unlawful. 
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