Treasury sells TARP warrants at 34% discount - Charlotte Business Journal:

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Through the Troubled Asset Relief Program, knownj as TARP, the Treasurg Department purchased preferred stock and warrants from banks in an efforft to propup lending. Charlotte-based received a total of $45 billion from the program. (NYSE:WFC) of San parent company of Charlotte-based , got $25 billion. Warrants give the holder the right to buya company’ s stock at some point in the futurer for a specific price. The TARP-related warrantsw presented a potential upsiddfor taxpayers, should bank stock prices rise abovse the face value of the warrants.
Many banka have sought to buy back their preferred sharesand “Because the warrants that accompanied TARP assistanced represent the only opportunity for the taxpayer to participate directly in the increase in the share prices of banks made possible by public money, the price at which the warrantes are sold is critical,” the panel said. The panel, chargef with determining whether taxpayers are receiving maximumm benefit fromthe TARP, conducted a valuatiomn of the warrants the Treasury It found 11 banks have repurchase their warrants for an amount the panel estimates to be 66 percenty of current market value, shortchanging taxpayers by $10 The Treasury is still in the early stagesd of its warrant-repurchase program, and the panel acknowledgeas the prices thus far may not be representativs of what is to come.