BRIEFING NOTES: Treasury Capital Purchase Program (CPP) Applications

    View Authors 20 October 2008
    • CPP Application Form – The two page application form is at the end of the Treasury’s “Application Guidelines” (released 10/20).  Information requested includes contact information, Amount of Preferred Shares Requested, Amount of Unissued Common and Preferred Stock, Amount of Total Risk-Weighted Assets,  Type of Company, and signature of CEO or Authorized Designee, among other basic questions.

    • All applications are due by 5 p.m. (EST) November 14, 2008.

    • Forms must be submitted to appropriate federal banking agency - e.g. FDIC, Fed Reserve, OCC, OTS.  Further details on respective agency’s websites on submission instructions can be found respective agency's websites. Institutions must consult with their appropriate federal banking agency prior to submitting the application.

    • Holding Companies - If the applicant is a bank holding company, the application should be submitted to both the applicant's holding company supervisor and the supervisor of the largest insured  depository institution controlled by the applicant. Questions regarding preparation of the application should be directed to the appropriate federal banking agency.

    • Eligibility –  The program is available to bank holding companies, financial holding companies, insured depository institutions and savings and loan holding companies. Applicant must be established and operating in the United States and may not be controlled by a foreign bank or company.

    • Form of Capital Qualifying for Purchase – Bank Holding Company or Savings and Loan Holding Company – Cumulative Perpetual Stock: “Capital purchases to occur at the highest-tier holding company in cases in which the banking organization has a bank holding company or a savings and loan holding company; capital eligible for purchase is cumulative perpetual preferred stock of the highest tier holding company. Shares must be pari passu with the most senior preferred shares available by the applicant.”

    • Form of Capital Qualifying for Purchase - Insured Depository Institution -  Non-Cumulative Perpetual Preferred Stock -  “In the case of an insured depository institution that is not controlled by a company, the capital eligible for purchase by the Treasury under the CPP is non-cumulative perpetual preferred stock of the insured depository institution. The shares must be pari passu with the most senior preferred shares available by the applicant.”

    • Maximum amount of capital eligible for purchase by the Treasury -  lesser of (i) 3 percent of the Total Risk-Weighted Assets of the applicant or (ii) $25 billion.

    • Minimum amount eligible for purchase under the CPP is 1 percent of the Total Risk-Weighted Assets of the applicant.
    • Click here for Application Guidelines.