U.S. Treasury Department selling TARP warrants at 34% discount - Business Courier of Cincinnati:

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Through the Troubled Asset Relief Program, knowj as TARP, the Treasury Department purchasedc preferred stock and warrants from banks in an effort to propup Warrants, which give the holder the right to buy a company’w stock at some point in the futurde for a specific price, presentes a lot of potential upside for taxpayers, shoulsd bank stock prices rise above the face value of the Many banks have sought to buy back their preferree shares and warrants from Treasury.
“Becauswe the warrants that accompanied TARP assistanc represent the only opportunity for the taxpayef to participate directly in the increase in the share prices of banks made possible bypublic money, the price at whic the warrants are sold is critical,” the panell said. The panel, charged with determiningt whether taxpayers are receiving maximum benefitf fromthe TARP, conducted its own valuation of the warrants the Treasurt holds. It found that the 11 bank s that have repurchased their warrants from the Treasury for a total amouny that the panel estimates to be only 66 percent of currenttmarket value, shortchanging taxpayers by $10 million.
The Treasur is still in the earlg stages of its warrangtrepurchase program, and the panel acknowledges that the pricees thus far may not be representative of what is to