Bank of America set to repay TARP money

The bank announced Wednesday that it would be repaying $26.2 billion in cash and $18.8 billion by selling securities. These securities would later be converted to common stock.

BOA received $25 billion in Oct. 2008 and $20 billion this year in January through the Troubled Asset Relief Program (TARP).

It was the one of the very few companies who received "exceptional" assistance from the U.S. government.

Positive sign for the economy
"We are pleased that Bank of America is moving ahead with plans to pay the taxpayers back in full. As banks replace Treasury investments with private capital, confidence in the financial system increases, taxpayers are made whole, and government's unprecedented involvement in the private sector lessens," said a Treasury Department spokesman.

Once the bailout money is repaid, the bank will no longer need to consult the Treasury Department. The bank's recovery has been fast, unlike other American banks affected by the financial crisis.

Bank of America outshone in the financial crisis as one of the strongest banks of the nation. In Sept. 2008, it bought investment bank Merrill Lynch.

First company to completely repay taxpayers
Bank of America will likely become the first bailed-out company to repay the taxpayers completely. It has not confirmed when it would be repaying the amount, but sources close to the matter say it would be in this month.

The Bank's Chief Executive Officer, Kenneth Lewis, scheduled to retire at the end of the year, said the repayments show the improving health of the economy.

"It is a milestone indicating that public policy has succeeded in helping our industry and the economy begin to recover," said Lewis announcing company's plan to repay the money.

The bank’s main focus now will be to appoint Mr. Lewis’s successor. The board plans to meet in Charlotte this week, to select from the list of shortlisted candidates. Gregory Curl, chief risk officer of the bank, is said to be a strong contender.