The Troubled Asset Relief Program (TARP) is the U.S. Government’s $700 billion financial rescue plan that was recently signed into law by President Bush. Reuters has reported that as many as 1,800 financial institutions could soon apply for government funds. $250 billion has already been allocated, and of that amount, $125 billion will go to nine of the nation’s largest banks with another $33 billion going to regional banks.
These financial institutions are all publicly held companies. It is still unclear whether TARP funds will be made available to privately held companies and life insurance companies. If so, it is reasonable to expect some life insurance companies will take advantage of the government funding, although not to the extent of the funds borrowed by AIG.