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Goldman is finally free from Tarp

GOLDMAN Sachs has finally escaped the US government&rsquo;s Troubled Asset Relief Programme (Tarp), after redeeming stock warrants issued to the Treasury.<br /><br />The bank, which booked record profits of $3.44bn (&pound;2.1bn) in the second quarter, said it had repaid $1.1bn to the government for warrants issued when the Treasury ploughed $10bn into the bank via Tarp.<br /><br />The payment, which was determined by the Treasury, comes on top of $318m in dividends paid on preferred stock taken by the government as part of the bailout package.<br /><br />Goldman initially offered to pay $600m to redeem the warrants, but eventually agreed to a $900m fee demanded by the Treasury.<br /><br />The rising value of its share price since the agreement has boosted the payout to the $1.1bn it paid back yesterday.<br /><br />Goldman, led by chief executive Lloyd C Blankfein, said the combined $1.42bn of redemption fees and dividends represented a 23 per cent annualised return on taxpayers&rsquo; investment.<br /><br />But the bank is still facing criticism for the $6.65bn it set aside for pay in the second quarter.<br /><br />Rivals JPMorgan, which took $25bn from Tarp, and Morgan Stanley, which was loaned $10bn, have not yet bought back their warrants.