Getting Every Penny Back from BofA, JPMorgan and Wells is Just the Beginning (BAC, JPM, WFC)
Bank of America Corp. (NYSE:BAC), JPMorgan Chase & Co. (NYSE:JPM) and Wells Fargo & Co. (NYSE:WFC) have already paid up, returning more than $180 billion in bailout funds. Former Treasury Secretary Henry Paulson is on mission to get the U.S. government repaid in full for the funds it put into the country’s lenders.
“We will get every penny we put into the banks back and then with a profit ... I think when you look at all the other programs we may be surprised at what we get back" - book-touring former Treasury Sec. Henry Paulson at a meeting of the Greater Omaha Chamber, responding to a question from an in-sync Warren Buffett.
Bloomberg.com -- More than 700 U.S. banks, insurers and credit card companies applied to the government for cash from the U.S. Treasury’s $700 billion Troubled Asset Relief Program. Borrowers including Bank of America Corp., JPMorgan Chase & Co. and Wells Fargo & Co. have returned more than $180 billion in bailout funds, according to data compiled by Bloomberg.
A government watchdog monitoring the bailout said last month TARP will cost taxpayers less than previously predicted. An earlier report from Special Inspector General Neil Barofsky to Congress predicted the final cost could be “substantial.”
Paulson in 2008 injected capital into banks in exchange for preferred shares paying 5 percent and warrants to buy common stock.
Paulson was responding to a question from billionaire Warren Buffett. Buffett and Paulson appeared on stage together at an event to promote Paulson’s book, “On the Brink.”
“I think you’re right,” Buffett said when Paulson said the U.S. would recoup its investment. Buffett’s Berkshire Hathaway Inc. is based in Omaha. Buffett declined to comment after the event today.