Susquehanna Bancshares Inc. of Lititz, Pa., announced it is raising as much as $395 million in capital and said it could use some of the money to repay the Treasury Department.

The $13.7 billion-asset company said late Monday that it had commenced a $300 million common stock offering, which could swell by $45 million if underwriters exercise the overallotment. It is also offering $50 million in cumulative trust-preferred securities.

Susquehanna said some of the money could be used to repay $300 million it received through the Treasury's Troubled Asset Relief Program in December 2008. It said some funds may be spent on acquisitions and some could protect it against problem assets. At the end of 2009 its nonperforming assets of $243.8 million were 2.48% of its total assets, up 110% from a year earlier.

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