NEW YORK (Reuters) - Goldman Sachs Group Inc, Morgan Stanley and other banks have applied to repay billions of dollars they borrowed under the U.S. government's Troubled Asset Relief Program, sources familiar with the situation said on Monday.
U.S. banks are scrambling to repay TARP money as soon as possible, in an effort to signal their strength to the market and to avoid the tighter regulation that comes with government funds, particularly limitations on compensation.
Banks began gearing up to repay government funds soon after the U.S. government announced the results of stress tests on May 7.
[...] Wayne Abernathy, an executive at the American Bankers Association and a former Treasury official, told Reuters earlier on Monday that he expected the Treasury would act soon to let large banks repay TARP.
"I would think we're talking a matter of weeks, and probably just a few weeks, because I think Treasury wants the money, or at least some of it," he said.
The amount of money the government could get back could be substantial. Morgan Stanley and Goldman borrowed $10 billion under TARP in October, while JPMorgan took $25 billion. American Express received $3.4 billion in January.
By Susie Madrak — May 19, 2009