Submitted by Fox First at Ten on September 26th
WASHINGTON (AP) - The Treasury Department says regional bank company Zions Bancorp has repaid the $700 million it still owed for the federal bailout it received in the financial crisis.
Salt Lake City-based Zions was among hundreds of banks that received bailouts in late 2008 after their bad loans mounted, under Treasury's Troubled Asset Relief Program, or TARP. In March, Zions repaid the first $700 million of the $1.4 billion it received.
Treasury said Wednesday that Zions also has paid $253 million in dividends. The government still holds warrants to buy Zions common stock, which it expects to sell for an additional return.
About $245 billion went to 707 banks under TARP. Treasury says it's now recovered around $266 billion from banks' repaid loans, dividends and interest.
The profits from the bank rescue have helped offset losses in the broader TARP bailout. The government loaned $417 billion to financial institutions and automakers under TARP. It has recovered $383 billion so far, or about 92 percent
Zions said its latest repayment will result in an expense of $16.6 million against its preferred stock dividends for the third quarter.
Harris Simmons, the company's chairman and CEO, said the repayment marks a significant milestone. "We expect to be able to sharpen our focus on expanding our business, while continuing to reduce higher-cost sources of capital and funding that stem from the financial crisis," Simmons said in a statement.
Zions has about 500 offices across Arizona, California, Colorado, Idaho, Nevada, New Mexico, Oregon, Texas, Utah and Washington.
Zions shares rose 17 cents to $20.50 in afternoon trading Wednesday.
Copyright 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
