By Ari Levy
Jan. 27 (Bloomberg)
Since the U.S. Treasury began investing in banks through its Capital Purchase Program, a gauge of participating companies’ share prices has lost four times as much as the Standard & Poor’s 500 Index.
An index of 201 publicly traded companies to receive funding in the plan, part of the Troubled Asset Relief Program, has plunged 45 percent since Oct. 28, compared with an 11 percent decline in the S&P 500. The 81- company S&P 500 financials group has dropped 41 percent. The TARP index is weighted by the amount each company took.
“I don’t think anyone behind the TARP plan thought this would be a get-rich-quick scheme,” said Jack Ablin, chief investment officer at Harris Private Bank in Chicago, which oversees $55 billion. “The jury is still out on this stuff.”
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