Texas Banks Receive Bail-Out Money

Four Texas banks receive almost $135 million in TARP funds.

WASHINGTON, D.C., Jan. 22, 2009 -- The U.S. Treasury Department announced details this week of a $1.5 billion investment in 39 banks made through its Capital Purchase Program.

Treasury created the Capital Purchase Program, a part of the Troubled Asset Relief Program, to help to stabilize and strengthen the U.S. financial system. Treasury allocated $250 billion under TARP's Capital Purchase Program to invest in U.S. financial institutions.

To date, the Department has made $193.8 billion of investments, receiving preferred stock and warrants from participating institutions. Investments have ranged from as small as $1 million to as large as $25 billion, financing community banking and Community Development Financial Institutions in 43 states and Puerto Rico.

In the most recent disbursement of $1.5 billion, the Treasury department invested over $134 million in four Texas banks:

* Texas Capital Bancshares, Inc., Dallas                      $75,000,000
* Metrocorp Bancshares, Inc., Houston                         $45,000,000
* TCB Holding Company (Texas Community Bank), The Woodlands   $11,730,000
* Treaty Oak Bancorp, Austin                                   $3,268,000

The money to the Texas financial firms was not the largest investment made in the package. That honor went to First Bancorp, of San Juan, Puerto Rico. That institution received a whopping $400 million of taxpayer dollars.

Institutions that sell shares to the government must comply with restrictions on executive compensation during the period that Treasury holds equity issued through the program.

The banks must also agree to limitations on dividends and stock repurchases.

Information about Treasury's Troubled Asset Relief Program can be found at http://www.treas.gov/initiatives/eesa/.