A New York private equity firm has agreed to invest $250 million in Flagstar Bancorp Inc., gaining 70% ownership of the Troy, Mich., thrift company. But the deal's completion hinges on Flagstar receiving an additional $250 million from the Treasury Department's Troubled Asset Relief Program.

The $14.2 billion-asset Flagstar disclosed on Oct. 31 that it had applied for the Treasury funds.

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