The U.S. Treasury confirmed Tuesday that 10 of the largest U.S. financial institutions have been approved to repay the funds they received from the government under the Troubled Asset Relief Program (TARP) facility established last fall.

Treasury said that 10 banks have met the requirements for repayment established by the primary federal banking supervisors, and it has notified the institutions that they are now eligible to complete the repayment process. If these firms choose to do so, Treasury will receive US$68 billion in repayment proceeds, it said.

The government didn’t name the firms that are expected to repay their bailout funs, but firms that have announced they qualify include Goldman Sachs, JP Morgan Chase, Morgan Stanley, State Street Corp., US Bancorp, Bank of New York Mellon, and Capital One Financial Corp.

The repayments follow a period in which many banks have raised equity capital from private investors. Also, for the first time in many months, these banks have issued long-term debt that is not guaranteed by the government.

Ronald Logue, chairman and CEO of State Street, said, “As a result of improving financial market conditions and our strong capital position, State Street has been able to replace the government’s CPP funds with private capital, in keeping with the Treasury’s original intent.”

Morgan Stanley said in a statement, “We believe this positive development reflects both Morgan Stanley’s strong capital position as well as the important systemic role the TARP program played in helping stabilize the U.S. banking system since the height of the financial crisis. After exiting the TARP program, Morgan Stanley will continue working closely with the Obama administration, elected officials, our regulators and our peers on the best possible framework to ensure the safety and soundness of the U.S. banking system.”

“These repayments are an encouraging sign of financial repair, but we still have work to do,” said Treasury secretary, Tim Geithner.

IE