Pulaski Financial (PULB) in St. Louis has repurchased $6 million worth of its Troubled Asset Relief Program shares following their auctioning last year by the Treasury Department.
With the repurchase, Pulaski has now redeemed $15.2 million, or 47%, of the total Tarp shares it issued. The $1.3 billion-asset company received $32.5 million through the program in January 2009.
The Treasury Department sold its Tarp stake in Pulaski in June 2012, and Pulaski was one of a handful of banks that bid on its own shares at that auction. Pulaski repurchased a further $6.6 million worth of the preferred shares from third-party investors in August 2012.
"We are pleased that we have been able to fund all of our repurchases to date using cash from accumulated earnings and excess capital," said Gary Douglass, Pulaski's president and chief executive, in the news release. "Going forward, we will look for opportunities to repurchase additional preferred stock as our earnings and capital levels permit, or in another manner that is beneficial to common shareholders."
Pulaski earned $3.6 million in the second quarter, a 31% year-on-year increase, as its mortgage revenue increased and chargeoffs declined, according to its latest quarterly earnings report.
The Treasury has ramped up its auctions of Tarp holdings this year as it seeks to wind down the program. The Treasury holds Tarp stakes in 127 banks and has recovered approximately $403 billion of the $420.6 billion in Tarp funds it issued, according to the agency's latest report to Congress on the program, delivered August 12.
Banks have been seeking to redeemtheir Tarp shares before the interest rate on the stock jumps to 9% from 5% at the fifth anniversary of the issuance of the shares.