Treasury: Financial bailout income at $35 billion

WASHINGTON: The government's heavily criticized $700 billion financial rescue program has earned nearly $35 billion in income over the past two years.

The data showed that income from the Troubled Asset Relief Program rose nearly 17 per cent through November, compared to where it stood in October. The income was boosted by the government's ongoing sales of Citigroup stock.

Republicans used voter unhappiness with the bailout and soaring federal budget deficits to pick up six Senate seats in the November elections and take control of the House of Representatives.

The $35 billion estimate will be included in the monthly report on the bailout that is due to be released later Friday. The AP obtained the data in advance.

The new total is up from the nearly $30 billion in income shown in the previous report covering the program's finances through October.

Much of the added income came from the government's sale of Citigroup common stock. The Treasury Department sold off the last of its stake in the giant banking company on Tuesday, ending up with a profit of $12 billion on the government's investment of $45 billion.

Smaller amounts came from dividend payments from other banks that received support from the bailout fund, and also from dividends from the support provided to the former financing arm of General Motors.

While income from the bailout has risen, the estimates of its overall final costs have been dropping. Last month, the Congressional Budget Office slashed its estimate of the projected losses from the bailout program to $25 billion, down from an August projection of $66 billion and a March forecast that the program would cost the government $109 billion in losses.

The CBO credited TARP's brighter prospects to continued repurchases of preferred stock by banks that received the bailout funds, a lower estimated cost for assistance to insurance giant American International Group and automakers Chrysler and GM.

TARP, which was developed by the previous Bush administration and passed by Congress at the height of the financial crisis in October 2008, became widely unpopular with the public.