When you do a Google news search for “TARP” there is a common theme throughout the results: more and more banks want to repay the money. The reason for the change of heart, it fuels government power within the financial markets and tax payers have had enough and rightfully so.
This trend to return TARP funds started with smaller banks, such as the Community Bank of the Bay in California, who plans on repaying the $1.7 million in TARP funds after applying for them this past fall to shore up their already strong balance sheets. But the bank is doing more than just returning tax payers money – they are giving the Treasury Department a piece of their mind.
Brian Garrett, the CEO of Community Bank of the Bay, recently said, “We did not make subprime loans, engage in predatory lending, sell ‘toxic derivatives’ or open off-shore accounts.” This sentiment is shared with William Fenstermaker, the chairman of Iberiabank board, albeit expressed in a softer tone, when he said: “In the very beginning, if you got TARP you had kind of a seal of approval that were healthy. And I think that time has gone by, it’s turned into, if you took TARP, you were unhealthy.”
This trend isn’t just prevalent in the financial world. In a separate bailout, Ford Motor Company, the only one of Detroit’s Big Three to not take bailout money, is in the best position financially:
Ford, which has not taken any bailout money, has had more success initiating its restructuring than G.M. and Chrysler have achieved under government edict. Those companies are struggling to meet the terms of federal loans.
Analysts said that Ford’s debt initiatives, and an earlier agreement it secured with the United Automobile Workers union, reinforce its status as the healthiest of Detroit’s automakers.
“Ford is being proactive and showing that progress can be made and that things can be done expeditiously,” said Erich Merkle, an independent auto analyst in Grand Rapids, Mich.”
The reality is, when it comes to bailouts, the resounding feeling coming from the American public is simply this: Stop. And it looks like that idea is spreading to at least some of the recipients as well.
[youtube]http://www.youtube.com/watch?v=F816XEsD-HM[/youtube]