Two more banks received bailout assistance last week, while another took steps to leave the controversial program.
IA Bancorp accepted $5.9 million in assistance under the Troubled Asset Relief Program, the Treasury Department said in its weekly report on bailout activity. The company, which operates as Indus American Bank, serves the Indian-American community in the New Jersey area.
Virginia-based Hometown Bankshares Corp. received $10 million in aid. In June, the bank announced plans to open additional branches in the state, a move it said could require it to seek assistance under the bailout program.
While IA Bancorp and Hometown Bankshares were accepting federal bailout funds, New Jersey-based Valley National Bancorp returned $125 million to the Treasury, an effort that gets the bank closer to fully repaying the $300 million it originally received. Earlier this month, BailoutSleuth reported that Treasury had approved the repayment of $75 million.
The bank's incremental approach in withdrawing is somewhat unique among bailed-out banks. In a statement, Valley National called it "a cautious strategy based upon the current economic climate" and said it expected to "have adequate cash available for potential future repayments of the remaining $100 million in senior preferred shares."
Treasury continues to hold warrants entitling it to purchase 2.4 million shares of Valley National. Valuing such warrants is a complicated process, and banks have typically waited to buy them back until fully redeeming the common and preferred shares held by the government.
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