In a developing story the Wall Street Journal (WSJ) reports that the United States Treasury Department is contemplating taking equity stakes in
insurance companies. The Treasury Department wants insurance companies to
participate in its TARP Program, according to WSJ sources briefed by Treasury.
The TARP program is a voluntary Capital Purchase Program to encourage U.S. financial
institutions to build capital to increase the flow of financing to American
businesses and consumers and to support the U.S. economy.
According to the WSJ, Met Life Inc. and Prudential Financial Inc. two of the nation's largest publicly traded life insurers, and
New York Life Insurance Co., one of the highest rated insurers in the
United States, are interested in exploring a sale of equity stakes to the
government, according to people familiar with the matter.
The former two are holding companies to structured settlement annuity issuers (Prudential Financial Inc. also guarantees periodic payment obligations transferred via non qualified assignment to Pruco Assignment Corporation) and the latter is a structured settlement annuity issuer.
The U.S. Treasury is considering taking stakes in 20 financial firms.
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