Salty,
Taxpayers are made whole in sale of Reliance Bank’s TARP
Sep 18, 2013, 2:36pm CDT Updated: Sep 18, 2013, 5:07pm CDT
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Tom Brouster, chairman of Reliance Bank
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Tom Brouster, chairman of Reliance Bank
Greg Edwards
Reporter- St. Louis Business Journal
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The government’s Troubled Asset Relief Program investment in Reliance Bank sold at a premium at auction this week, a rare event and good news for taxpayers.
The government’s investment in Reliance, which took $40 million in TARP money in February 2009, sold for $1,005 per $1,000 for 40,000 Series A shares and $1,111 per $1,000 for 2,000 Series B shares, the Treasury Department reported.
“Only a few banks nationwide have sold at a premium, and Reliance was the largest,” said Reliance Chairman Tom Brouster, who raised $31 million in capital earlier this year and has turned around the bank’s troubled loan portfolio. “The key is that the buyers of the TARP looked at the value and saw the results of what has happened at the bank.”
In contrast, the TARP shares of Centrue Financial Corp., which took $32.7 million in January 2009, sold for $325 per $1,000 par value this week, a 67.5 percent discount.
The remaining 11,669 TARP shares of First Banks Inc. sold for $552 per $1,000, a 45 percent discount. The Treasury had auctioned most of its First Banks shares last month, also at a discount. First Banks took $295.4 million in TARP in December 2008.
“We feel good that taxpayers got out whole,” Brouster said.
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