The U.S. Treasury Department announced this morning it will dispose of several warrant positions made under the Capital Purchase Program (CPP). During the next six weeks, the department intends to conduct auctions to sell its warrant positions in Wells Fargo & Co., PNC Financial Services Group Inc., Comerica Inc., Valley National Bancorp, Sterling Bancshares Inc. and First Financial Bancorp. The warrants were received in consideration for investments made in the banks.

Each of these banks has fully repurchased the preferred stock investments made by the Treasury Department. Wells Fargo repaid $25 billion borrowed under the Capital Purchase Program in December. TARP repayments now total $181 billion, well ahead of last fall’s repayment projections for 2010.

Treasury officials said last week that its programs aimed at stabilizing the banking system will earn a profit, thanks to dividends, interest, early repayments and the sale of warrants. Total bank investments of $245 billion in fiscal 2009 that were initially projected to cost $76 billion are now projected to bring a profit, officials said. The federal government has already received $14 billion through interest and dividends, and that number could be considerably higher by the end of this year.

The warrant sales anticipated over the next six weeks, if consummated in full, would represent the Treasury Department’s disposition of its remaining holdings in the six banks. The proceeds of these sales will provide an additional return from the department’s investments in those banks beyond the dividend payments it received on the related preferred stock, officials said.

The public offerings will be executed using a modified Dutch auction method that establishes a market price by allowing investors to submit bids at specified increments above a minimum price specified for each auction.

Prospective investors will be able to obtain copies of the prospectuses relating to these securities, when available, from Deutsche Bank Securities Inc., Prospectus Department, Harborside Financial Center, 100 Plaza One, Jersey City, N.J. 07311-3988, telephone: 1-800-503-4611, or by e-mail at prospectus.cpdg@db.com.