Treasury To Approve Insurers For TARP Funds: Sources
By Karey Wutkowski and Patrick Rucker
February 7, 2009
WASHINGTON (Reuters) - Insurance companies that applied for capital injections from the government's $700 billion financial bailout fund could get approval as soon as Monday, two sources familiar with the matter said on Saturday.
Some insurance companies recently received approval to acquire banks, paving the way for them to participate in the government's $250 billion capital injection program, which is part of the larger bailout fund.
The sources said those insurance companies could hear from the U.S. Treasury Department as soon as Monday about whether they will get cash in return for giving the government equity stakes.
About a dozen insurers have applied for capital injections, but it is unclear which companies will get approval.
Bank regulators last month approved applications from Hartford Financial Services Group Inc (NYSE: HIG) and Lincoln National Corp (NYSE: LNC) to become savings and loan holding companies, which is needed for them to be considered for the federal aid.
Genworth Financial Inc (NYSE: GNW), a U.S. life and mortgage insurer, said last month the U.S. Office of Thrift Supervision was still processing its application to become a savings and loan holding company.
Insurance companies have been seeking federal funds since large third-quarter investment losses eroded capital.
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