Pulaski Financial (PULB) in St. Louis has repurchased almost a quarter of the preferred stock it had issued to the Treasury Department under the Troubled Asset Relief Program and that was subsequently sold to private investors in an auction.
The $1.3 billion-asset company said Wednesday that it purchased the stock for $6.6 million, representing a 7.2% discount to face value, using available cash. Pulaski is working to repurchase the remaining preferred securities prior to January 2014, when the dividend rate will increase from 5% to 9%, Gary Douglass, president and chief executive, said in a news release.
The Treasury is aggressively trying to wind down Tarp by selling preferred shares it still owns in some banks through auctions. Pulaski's shares were sold during an auction in June.
Pulaski received $32.5 million in Tarp funds in January 2009 after issuing roughly 32,500 preferred securities and a warrant to purchase up to approximately 778,400 shares of common stock at $6.27 per share to the Treasury. The company previously repurchased the warrant from the Treasury for $1.1 million in cash.