U.S. Bancorp will pursue an exit from the Troubled Asset Relief Program once it completes the federal government's "stress testing," this spring, chief executive Richard Davis said on Wednesday.
Speaking on a conference call to discuss the decision to slash its dividend by 88%, Mr. Davis said the Minneapolis company remains "dedicated and devoted to finishing the stress tests as it will allow the government to determine the health of each bank and their capital position."
However, he also said that the $266 billion-asset company "would like to emerge from the Tarp assets as soon as possible and return that money to the government."
The goal is to "move forward unfettered as it were," he said.
Mr. Davis added that returning the funds would require permission from regulators and is contingent on U.S. Bancorp's "financial ability" to repay the government.
U.S. Bancorp's dividend cut — which takes its quarterly payout from 42.5 cents per share to five cents — will allow it to hold on to $2.6 billion annually.
The company received $6.6 billion in capital from the Tarp program.
TCF Financial earlier this week said it would seek an exit from the program, saying the attractiveness of the funding had waned because of changes in how the public perceives Tarp recipients.
