On Dec. 19, the U.S. Department of the Treasury (Treasury) announced that it sold its remaining 54.9 million shares of Ally Financial Inc. common stock as part of the Treasury’s Troubled Asset Relief Program (TARP) under the Auto Industry Financing Program (AIFP).
“With this sale, we are exiting the last major TARP investment and winding down the Auto Industry Financing Program,” Treasury Secretary Jacob Lew said in a conference call.
TARP was started by the Emergency Economic Stabilization Act of 2008 to give the Treasury the authority to implement programs to stabilize the financial system. The program gave the Treasury Secretary the authority to purchase and to fund commitments to purchase troubled assets.
Through AIFP, the Department invested approximately $80 billion in the auto industry. With the sale of its Ally shares, the Department recovered $19.6 billion, roughly $2.4 billion more than originally invested.
“With the proceeds from this sale, we will have recovered $441.7 billion on all TARP investments including the sale of the Treasury’s AIG shares, compared to $426.4 billion disbursed,” Lew said.
According to its latest monthly report to Congress, the Treasury’s estimated lifetime cost (as of Sept. 30) for TARP programs is $37.49 billion. The estimated lifetime cost is the Treasury’s best estimate of what the program ultimately will cost the taxpayer. Of the $426.4 billion disbursed, $920 million remains outstanding.