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Client Alert: Treasury Sets Deadline To Participate In Individual TARP Auctions

Action Required by Friday, December 20, 2013

As part of its continuing process to wind down the Troubled Asset Relief Program (“TARP”), the United States Department of the Treasury has set a deadline for remaining TARP issuers to participate in a “single-name auction” of their securities held by Treasury through the Capital Purchase Program (“CPP”).

Pursuant to a letter released on October 24, 2013, in order to participate in an individual auction, issuers must complete all requirements, including all documentation and any regulatory approvals, by December 20, 2013.  Note that regulatory approvals may take up to six weeks and are generally only required if issuers or insiders intend to repurchase CPP securities through the auction.  

Treasury has indicated that it will proceed with pooled sales or other types of competitive dispositions for its CPP investments in institutions that do not complete the requirements by the December 20 deadline.

Since Treasury began the auction process in 2012, we have counseled over 30 financial institutions and bidders in preparing for or proceeding through the auction process.  We have a number of attorneys who are experienced in the corporate, securities and bank regulatory aspects of the auction process.  Please contact one of our attorneys listed in the left column if you have any questions on the auction process.

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