The Hartford Financial Services Group, Inc. said it has repaid the U.S. government for its bailout by repurchasing all of The Hartford’s preferred shares issued to the U.S. Department of Treasury under the Capital Purchase Program (CPP), also known as the Trouble Asset Relief Program (TARP).
The Hartford paid $3.4 billion to the U.S. Treasury to repurchase the preferred stock, plus a final dividend payment of about $21.7 million. The Hartford funded the repurchase with proceeds from its recent equity and debt offerings, as well as from available resources.
In June 2009, the insurer took $3.4 billion of federal bailout money, the maximum it was authorized to accept, to bolster capital in the wake of large investment losses
The U.S. Treasury continues to hold warrants to purchase approximately 52 million shares of The Hartford’s common stock at an initial exercise price of $9.79 per share. The company does not intend to repurchase the warrants from the U.S. Treasury.
“We are pleased to complete our plan to return the U.S. Treasury’s investment in The Hartford and appreciated the opportunity to participate in CPP and the support of the government and American taxpayers,” said Liam E. McGee, The Hartford’s chairman, president and CEO. “With the capital raise completed and the investment repaid, we are well positioned from both a capital and balance sheet perspective.”
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