JPMorgan Chase & Co said on Monday it plans to raise $5 billion of common equity, which it said will enable it to repay this month the $25 billion it took from the government's bank bailout plan.

The New York-based bank plans to raise the capital by selling common stock, and to price the offering by Tuesday morning, a person close to the matter said.

JPMorgan, the nation's second-largest bank, was among 19 U.S. lenders to recently undergo government stress tests of its ability to weather a deep recession, and was one of nine that regulators said did not need more capital.

The bank said that once it completes its latest capital raising, it will have met all the conditions to repay the $25 billion it took from the Treasury Department's Troubled Asset Relief Program.

It said it expects to repay the government before the end of June, and that doing so is in the best interests of the country and the company.

Many banks have criticized TARP for its restrictions, including on compensation, and the perception among investors that recipients are desperate for capital.

JPMorgan Chief Executive Jamie Dimon has called it a scarlet letter for a bank to be involved in TARP.

JPMorgan shares closed Monday down 79 cents at $36.11 on the New York Stock Exchange.

(Reporting by Jonathan Stempel; Editing by Ted Kerr)