Most of the pay-back-TARP-funds discussion, as of late, has been focused on the really big banks. But the discussion among small banks has been going on even longer. Some banks are making good on their word to pay back the funds. The New York Times reports that four small banks have recently paid back the money. I think more will soon.

What has changed? Some think a stigma has been attached to such funds. Originally, TARP was billed as a program to help banks boost lending by injecting cheap liquidity, but it has come to be seen as a sign that the bank is weak. At the same time, the talk of government restrictions--not so much the current ones, but ones that might come--have spooked some executives. So it make sense for them to pay it back. At the big bank level, the issues are a bit trickier. 

For more:
- here's the article

Related Articles:
TARP payback blitz in the offing?
Morgan Stanley not in rush on TARP funds
A modest proposal on paying back TARP funds
Should banks rush to pay back TARP funds?
Northern Trust to pay back TARP funds