Some of the largest U.S. banks will remain caught in the government's financial bailout program for months, as officials do not expect to grant the next wave of exit approvals until near the end of the year, according to a source familiar with the matter.

Banks such as Citigroup and Bank of America Corp have been chafing under the government's reins and want to exit the Troubled Asset Relief Program (TARP), which delivered capital infusions to banks along with limits on pay, share repurchases and dividends.

Citigroup has been in preliminary talks with U.S. officials on how to repay part of government funds but the process could take at least a couple quarters, according to sources familiar with the situation.

Regulators want to see that firms have fully taken advantage of the more open credit markets to raise significant capital buffers before they remove the government leash from more of the largest banks.

The U.S. Treasury Department first started releasing the big banks from the financial bailout after the government conducted an intensive stress test earlier this year of the firms' loan portfolios, earnings prospects and capital positions.

Ten banks received approvals in June to repay $68 billion in federal bailout funds. Since then, there have been few clues about when the other large banks would be allowed to exit the program and if those approvals would come piecemeal or as another group.

We will see another wave of repayments, the source said, speaking anonymously because the approach has not been announced publicly.

A Treasury spokesman declined to comment.

There is intense investor interest in which banks will be released, and the government is aware that granting individual approvals for the biggest banks to repay TARP could put immense pressure on the other institutions, the source said.

The large banks still locked in TARP include: Wells Fargo , Fifth Third , GMAC, KeyCorp , Bank of America, PNC Financial
, Regions Financial , SunTrust , and Citigroup .

Some of these institutions demonstrated on Tuesday just how eager they are to exit TARP. Appearing at the Barclays Global Financial Services Conference in New York, leaders at SunTrust, Regions Financial and Bank of America all spoke out about how they want to repay, and do it as soon as possible.

It is very desirable to get out from under this, said Michael Holland, president of money manager Holland & Co in New York. This is a crisis situation that one would hope is now behind us. The longer they are in it, the more we are being told by the feds that this isn't behind us.

(Reporting by Karey Wutkowski in Washington and Steve Eder in New York with additional reporting by Dan Wilchins and Joe Rauch; editing by John Wallace and Matthew Lewis)