By Eileen Ambrose, The Baltimore Sun
6:43 PM EDT, September 11, 2013
The Treasury Department announced it intends to sell securities of six banks, including Severn Bancorp Inc. of Annapolis, as it winds down the Troubled Asset Relief Program.
TARP was created five years ago to stabilize the country's financial system during the financial crisis. The government provided banks with capital in exchange for dividend-paying preferred stock.
Severn, the parent of Severn Savings bank, received nearly $23.4 million, but is behind on six dividends payments totaling $1.75 million, according to a Treasury report released this week. The department plans to auction the securities of the six banks starting this week and conclude the sale on Tuesday.
Thomas Bevivino, Severn's chief operating officer, said the bank has the cash to pay the dividends but regulators prohibited it from doing so because of its level of non-performing loans. "We are anxious to work with the new owners of those shares," he said.
Treasury said it invested $245 billion in banks under TARP and has recovered nearly $273 billion through repayments, dividends and other income.
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