TARP Repayments

[davelj]

[quote=ucodegen]

To use an example, lets say that F&F charge off 10% of their portfolio (which would be a big number). Further, let’s say the average yield on the remaining 90% of their book is 5.5% and their funding costs (now borrowing at govt rates) are 2.5%.

I think your estimate of borrowing costs for FRE/FNM are almost double what they currently are. Is some of that for long term borrowing that has not yet rolled over?

http://www.reuters.com/article/idCNN077795720091207?rpc=44%5B/quote%5D

If you match fund the portfolio with a mix of 5-7 year treasuries, you’ll come out at around 2.6% – I just rounded it off to 2.5%. I’m lazy that way.

[DWCAP]

Great breakdown Dave. Bank TARP hasnt been a total loss for the American taxpayer. But I wonder how financing plays into the return. It wasnt free for the treasury to get those billions.

2% of 160 billion is still $3.2billion, how is that accounted for in those calculations?

[DWCAP]

Great breakdown Dave. Bank TARP hasnt been a total loss for the American taxpayer. But I wonder how financing plays into the return. It wasnt free for the treasury to get those billions.

2% of 160 billion is still $3.2billion, how is that accounted for in those calculations?

[DWCAP]

Great breakdown Dave. Bank TARP hasnt been a total loss for the American taxpayer. But I wonder how financing plays into the return. It wasnt free for the treasury to get those billions.

2% of 160 billion is still $3.2billion, how is that accounted for in those calculations?

[DWCAP]

Great breakdown Dave. Bank TARP hasnt been a total loss for the American taxpayer. But I wonder how financing plays into the return. It wasnt free for the treasury to get those billions.

2% of 160 billion is still $3.2billion, how is that accounted for in those calculations?

[DWCAP]

Great breakdown Dave. Bank TARP hasnt been a total loss for the American taxpayer. But I wonder how financing plays into the return. It wasnt free for the treasury to get those billions.

2% of 160 billion is still $3.2billion, how is that accounted for in those calculations?

[Adebisi]

With the Fed purchasing $1.25 trillion in MBS trash, is it any surprise that some of the $700 billion in TARP is being paid back?

http://www.newyorkfed.org/markets/mbs_faq.html

Clearly the liability just got transferred from TARP to the Fed.

[Adebisi]

With the Fed purchasing $1.25 trillion in MBS trash, is it any surprise that some of the $700 billion in TARP is being paid back?

http://www.newyorkfed.org/markets/mbs_faq.html

Clearly the liability just got transferred from TARP to the Fed.

[Adebisi]

With the Fed purchasing $1.25 trillion in MBS trash, is it any surprise that some of the $700 billion in TARP is being paid back?

http://www.newyorkfed.org/markets/mbs_faq.html

Clearly the liability just got transferred from TARP to the Fed.

[Adebisi]

With the Fed purchasing $1.25 trillion in MBS trash, is it any surprise that some of the $700 billion in TARP is being paid back?

http://www.newyorkfed.org/markets/mbs_faq.html

Clearly the liability just got transferred from TARP to the Fed.

[Adebisi]

With the Fed purchasing $1.25 trillion in MBS trash, is it any surprise that some of the $700 billion in TARP is being paid back?

http://www.newyorkfed.org/markets/mbs_faq.html

Clearly the liability just got transferred from TARP to the Fed.

[ucodegen]

Great breakdown Dave. Bank TARP hasnt been a total loss for the American taxpayer. But I wonder how financing plays into the return. It wasnt free for the treasury to get those billions.

Look at the return on treasury bills vs what TARP is charging.

Treasuries were going for about 0.40% +/- on a 1 year, 0.80% +/- on a 2 year, 1.34% on a 3 year. Spread against FNM and FRE TARP would probably be about 9% on $100Bil (using 2 year +). Spread against BAC and other banks would be about 2.5%.

http://www.treas.gov/offices/domestic-finance/debt-management/interest-rate/yield.shtml

[ucodegen]

Great breakdown Dave. Bank TARP hasnt been a total loss for the American taxpayer. But I wonder how financing plays into the return. It wasnt free for the treasury to get those billions.

Look at the return on treasury bills vs what TARP is charging.

Treasuries were going for about 0.40% +/- on a 1 year, 0.80% +/- on a 2 year, 1.34% on a 3 year. Spread against FNM and FRE TARP would probably be about 9% on $100Bil (using 2 year +). Spread against BAC and other banks would be about 2.5%.

http://www.treas.gov/offices/domestic-finance/debt-management/interest-rate/yield.shtml

[ucodegen]

Great breakdown Dave. Bank TARP hasnt been a total loss for the American taxpayer. But I wonder how financing plays into the return. It wasnt free for the treasury to get those billions.

Look at the return on treasury bills vs what TARP is charging.

Treasuries were going for about 0.40% +/- on a 1 year, 0.80% +/- on a 2 year, 1.34% on a 3 year. Spread against FNM and FRE TARP would probably be about 9% on $100Bil (using 2 year +). Spread against BAC and other banks would be about 2.5%.

http://www.treas.gov/offices/domestic-finance/debt-management/interest-rate/yield.shtml

[ucodegen]

Great breakdown Dave. Bank TARP hasnt been a total loss for the American taxpayer. But I wonder how financing plays into the return. It wasnt free for the treasury to get those billions.

Look at the return on treasury bills vs what TARP is charging.

Treasuries were going for about 0.40% +/- on a 1 year, 0.80% +/- on a 2 year, 1.34% on a 3 year. Spread against FNM and FRE TARP would probably be about 9% on $100Bil (using 2 year +). Spread against BAC and other banks would be about 2.5%.

http://www.treas.gov/offices/domestic-finance/debt-management/interest-rate/yield.shtml

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