Three Big Banks to Repay TARP Funds

BB&T (BBT Quote), US Bancorp (USB Quote) and Capital One(COF Quote) plan to sell common stock in public offerings and use the proceeds to repay the preferred stock and warrants the banks issued to the Treasury Department under Treasury's Troubled Asset Relief Program.

BB&T plans to sell $1.5 billion of its common shares and will temporarily reduce its quarterly dividend 68% to 15 cents a share. The cut in the dividend preserves about $725 million in capital on an annualized basis.

US Bancorp plans to sell $2.5 billion of its common stock and said it may offer medium-term notes in a benchmark amount in a public offering.

Capital One plans to raise about $1.75 billion through the sale of 56 million shares.

The three banks were among 19 banks that underwent stress tests by the U.S. government. The three were among nine identified as not needing extra capital.

U.S. Bancorp took $6.6 billion from TARP, Capital One took about $3.55 billion and BB&T $3.1 billion, according to Reuters.