By Connor Adams Sheets
The Flushing Savings Bank announced earlier this month that it has paid back the $70 million it received in December 2008 from the U.S. Treasury Department through the Troubled Asset Relief Program or TARP, as it is commonly known.
The controversial program, known by many as the bank bailout, has drawn extreme derision from many Americans who view it as a government handout to the mega-institutions that brought the economy to its knees.
But the program also helped smaller, financially healthy community banks such as Flushing Savings by providing inexpensive access to capital, provided they continued to lend money.
And Flushing Savings has done so, lending $389 million in the past nine months, the majority of which has gone to Queens and Brooklyn borrowers.
“We put the money to good use, and it’s all paid back,” said John Buran, president and CEO of the bank. “We’re a community bank and like any community bank it’s in our best interest to ensure that business owners and homeowners and residents in our community do well, that they prosper, because our business is in this backyard.”
The bank’s holding company, Flushing Financial Corp., issued $70 million in preferred stock to the Treasury through the program, the full amount of which it has now redeemed, or bought back, plus dividends and 5 percent interest.
The company is currently in negotiations to repurchase its warrants, which are similar to stock options.
Buran attributes the bank’s continued success in large part to the fact that it lends almost exclusively to New York City residents and businesses.
“That kind of lending has allowed us to continue to be successful,” he said. “We didn’t do exotic lending like subprime and we didn’t do real estate in Florida or California — we stuck to the area we know here in the New York community.”
Reach reporter Connor Adams Sheets by e-mail at csheets@cnglocal.com or by phone at 718-229-0300, Ext. 138.
