The government has earned more than $3 billion this year from auctions and repurchases of stock warrants it received from participants in the Troubled Asset Relief Program, according to the Treasury Department's latest warrant disposition report.

For every investment that Treasury made in a publicly traded financial services company through TARP's Capital Purchase Program and the Targeted Investment Program, it got preferred stock, plus warrants entitling the holder to buy common stock at a set price, similar to stock options.

When the TARP recipients exit the program by redeeming their preferred stock, they also can repurchase their warrants. If they decline, Treasury typically sells them through auctions.

So far in 2010, Treasury has earned $32 million from six banks that repurchased their warrants and more than $3 billion from 11 auctions. Bank of America Corp., which participated in both CPP and TIP, had two separate sets of warrants. Together those two auctions netted Treasury more than $1.5 billion.

The report also reveals that Treasury holds warrants in 15 publicly traded companies that have repaid their debts, the largest of which include Discover Financial Services, Hartford Financial Services and Lincoln National Corp. Treasury holds warrants in another 214 companies that have outstanding TARP debts.

Since TARP began in October 2008, Treasury has earned $7 billion from repurchases and auctions of warrants.

In the 14 warrant auctions held to date, the demand for warrants at a price above Treasury's minimum has exceeded supply an average of 6.5 times over, according to the report. That could be good news for taxpayers, who would profit from heightened demand for the warrants.