As of today, Chrysler has repaid its outstanding Troubled Asset Relief Program (TARP) loans. The repayment comes six years before the scheduled maturity of the loans.

Chrysler Group, LLC repaid $5.1 billion in TARP loans and terminated its ability to draw a remaining $2.1 billion TARP loan. In total, TARP has received $1.5 billion in interest and fees from Chrysler, including $865 million included in today’s transaction.

“Chrysler’s early repayment of its outstanding TARP loan is an important step in the turnaround of this company and the resurgence of the auto industry,” said Treasury Secretary Tim Geithner. “Because President Obama made the tough decision to stand behind and restructure the auto industry, America’s automakers are growing stronger, making new investments, and creating new jobs today throughout our nation’s industrial heartland.

Under TARP’s Automotive Industry Financing Program, Treasury committed a total of $12.5 billion to Chrysler. As of today’s transaction, Chrysler has paid back more than $10.6 billion of that amount to taxpayers through principal repayments, interest, and cancelled commitments.

Treasury still holds a 6.6% common equity stake in Chrysler, but is unlikely to fully recover its remaining outstanding investment of $1.9 billion in the company. Still, the expected costs of TARP’s support for the auto industry have come down dramatically over the last two years as the auto industry has continued to recover and strengthen.

Tags: chrysler, tarp, department of treasury
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