NEW YORK — Shares of some regional banks that haven't yet repaid Troubled Asset Relief Program funds slid Tuesday as repayments from their larger counterparts were again the talk of the market, leading to speculation about when and how the regional banks will repay their government funding.

Wells Fargo & Co. earlier Tuesday priced its $10.4 billion stock offering, intended to help it repay $25 billion in government support, and said it could raise more capital to avoid selling non-strategic assets. Citigroup Inc. and Bank of America Corp. have also recently signed agreements with regulators to repay the funds.

PNC Financial Services Group Inc., now the largest American commercial bank to carry government support, has said repeatedly that it's determined to pay back its $7.6 billion in TARP funds in a "shareholder-friendly way."

PNC's shares were recently down 4% at $51.21.

Bigger banks' shares were falling as well - with Bank of America down 2.2% to $15.29 and Citigroup down 3.4% to $3.58 - but the declines in the regional bank shares was steeper amid the uncertainty about TARP. Wells Fargo shares rose 2.3% to $26.07.

FTN Equity Capital Markets analyst Jeff Davis said politicians want TARP funds to be paid back because it counts as a receipt for government accounting and would go toward paying down the deficit. But regulators would rather see the banks overcapitalized before they pay the funds back, he said.

SunTrust Banks Inc. has $4.7 billion of TARP money, he said, and the parent company has $6.3 billion of cash and $1.2 billion in obligations that mature within a year, which is a lot of liquidity. "The parent, all else equal, could pay back the Treasury and still have reasonable liquidity to support its operations," he said.

But for money-losing banks like SunTrust, Davis said, regulators aren't going to like the bank unit declaring any dividends to the parent, so the parent will have to have extra liquidity. If banks pay back their TARP funds and then continue losing money in 2010, there could be a capital call to the parent companies to inject more capital to their bank units.

SunTrust shares fell 5.5% to $21.05.

Sandler O'Neill analyst Kevin Fitzsimmons said large regional banks like SunTrust, KeyCorp, Huntington Bancshares Inc. and Fifth Third Bancorp that are still in loss positions are separated from their peers that have gotten away from the government.

The market is likely building in the possibility of those banks having to raise common equity to pay back TARP, he said. And because those banks are in loss positions, the government would probably require a larger raise, which would be more dilutive to current shareholders, he added.

Huntington's shares slid 3.2% to $3.77, while Fifth Third's fell 2.9% to $10.03. KeyCorp declined 2% to $5.98 and another peer, Zions Bancorp, dropped 4.3% to $13.16.

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