The warrants for the bank, headquartered in Wayne, N.J., would be auctioned on Tuesday, the Treasury said. A minimum bid price is set at $1.70 per warrant. A warrant is a financial instrument that allows the holder to buy stock at a fixed price.
Financial institutions have been eager to cut ties to the bailout program, known as the Troubled Asset Relief Program, or TARP, to escape various restrictions imposed on banks receiving support. Those include limits on executive compensation.
The government received the warrants as part of the compensation for providing support to banks during the financial crisis.
Neil Barofsky, the special inspector general for the bailout fund, issued a report last week that found Treasury had failed to keep minutes or notes from phone calls with banks that received TARP money. He said there had been undocumented conversations in which billions of taxpayer dollars were at stake.
The Valley National warrant auction will follow auctions held in recent weeks for Comerica Inc. and PNC Financial Services Group Inc. The auction of 16.9 million PNC warrants raised $320.3 million while the auction of 11.5 million Comerica warrants raised $181.1 million.
