Monday, April 20, 2009
How Would The Capital Conversion Work?
Please click on the table to expand. Most readers will recognize this TARP recap. The TARP investments have been in the form of preferred stock. The NYT article I referred to earlier today puts forth the scenario of converting the preferred stake to common shares.
If this is the way the Treasury Department decides to go, common equity holders will be diluted into non-existence. I guess the Treasury could take losses to ease the dilution, but I don't like that idea.
Posted by MK at 12:14 PM