The Troubled Asset Relief Program (TARP) has started to grow again, after the Department of Treasury announced in December of last year the bailout would be coming to a close. Earlier this month, the Department of Treasury invested $21 million in small business loans with more investments to come that could total as much as $15 billion.
The money is being spent to purchase securities backed by the Small Business Administration in yet another effort to stimulate lending in the economy. The $15 billion dedicated to this program is considerably smaller than other TARP programs, such as the Capital Purchase Program (CPP), which purchased more than $204 billion in securities through the end of 2009.
The new investments will likely increase the cost of TARP overall. Currently the Congressional Budget Office estimates the bailout to cost $99 billion. There is no indication yet what costs will be added by the new program.
According to the Agency Financial Report, Treasury said that with CPP coming to a close, TARP as a whole would begin to wrap up. The agency did, however, acknowledge that the Small Business and Community Lending Initiative that was yet to start would cause an increase in TARP lending and funds had been reserved for this. At the time of that report Treasury was unsure of how and when the initiative would go forward.