WASHINGTON - The Treasury Department said on Thursday that losses from the government's $700 billion financial rescue fund are likely to rise as disbursements to battle mortgage foreclosures increase.
In a financial report on the program that accompanied a watchdog agency audit on Wednesday, the Treasury had said the program had estimated losses related to loans, equity investments and asset guarantees of $41.4 billion in its first year of operation.
As additional funds are disbursed, particularly for the housing initiative, the total cost of TARP is likely to rise, the Treasury said in a statement on Thursday. The administration has estimated the program, which it has extended to October of next year, will ultimately lose $141 billion.
(Reporting by Tim Ahmann; Editing by James Dalgleish)