State Street to issue stock, repay TARP funds


It appears that State Street (STT) is the next bank to jump on the payback bandwagon. This morning, the company announced that it plans to sell $1.5 billion of stock in order to help repay government bailout funds. In addition, STT took a $3.7 billion charge to move asset-backed commercial paper conduits to its balance sheet. In addition, STT will sell notes that are not backed by the government. All of these steps are being taken in hopes of repaying the U.S. Treasury for the $2 billion STT received as part of TARP.

The company forecast 2009 operating profit that will fall short of the Street's forecast, thanks to a "marginally weaker" environment than anticipated.