US Bancorp and BB&T Corp repaid billions of dollars in government bailout funds on Wednesday, the first of the large banks to do so, ahead of eight others given permission to return the money.
US Bancorp, repaying $6.6 billion, and BB&T, returning $3.1 billion, also said they intend to buy back warrants for their common stock from the US Treasury.
The Treasury said last week that banks repaying bailout funds could also buy back these warrants, which give the government the right to buy common stock at a predetermined price for up to 10 years.
The banks can buy back the warrants at “fair market value,” the Treasury said. US Bancorp and BB&T did not explain how, when or at what price they would buy back the warrants.
Several other big banks are also expected to make the bailout repayments on Wednesday. Goldman Sachs Group has said it will do so, and a person familiar with the situation said Morgan Stanley would, too.
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