TARP’s capital purchase program has earned $22 billion, following payments and income of $227 billion, GAO reports

About $22 billion has been earned for the federal government through a program that distributed billions of dollars in assistance to financial institutions in the wake of the 2008 financial crisis, the congressional watchdog said in a report issued Monday.

In its status update on the two active investment programs established through the Troubled Asset Relief Program (TARP) following the financial crisis, the Government Accountability Office (GAO) said the Capital Purchase Program (CPP), through which the Treasury Department traded assistance to banks suffering from the financial crisis for stock, has received about $227 billion in repayments and income. The program has made about $22 billion, GAO said.

The Community Development Capital Initiative (CDCI), which GAO said helped financial institutions in underserved areas, has received $587 million; Treasury expects to regain all but about $63 million from this program.

GAO said the Treasury’s total investment for the CPP program has been $204.90 billion. By December 2009, Treasury had disbursed all funds to 707 financial institutions nationwide, GAO said. As of the end of the third quarter of this year, GAO said,  Treasury had received $226.77 billion in repayments and income from its CPP investments and sales of original CPP investments. The original outstanding investment balance was about $20 million and two institutions remained in the program as of Sept. 30.

GAO said Treasury’s total investment for the CDCI program has been $570 million for 84 institutions. Of the total investment, Treasury disbursed $207 million through CDCI from July through September 2010. GAO said an additional $363 million represented exchanges of investments from CPP into CDCI. As of Sept. 30, GAO said, Treasury had received $587 million in repayments and income from CDCI participants. The original outstanding investment balance was $22.75 million and five institutions remained in the program, also as of Sept. 30.

GAO is required, under 2008 legislation, to report at least annually on TARP activities and performance.

GAO Status Update on Treasury’s Two Active Investment Programs Under TARP

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