Treasury announces Wells Fargo warrant auction

By MARTIN CRUTSINGER AP Economics Writer

WASHINGTON (AP) - The government says it will auction 110.3 million warrants it received from Wells Fargo & Co. as part of its effort to recoup the costs of the $700 billion financial bailout.

The Treasury Department said the auction of the Wells Fargo warrants will take place on Thursday. It set a minimum bid price of $6.50 per warrant. A warrant gives the purchaser the right to buy common stock at a fixed price.

Financial institutions have been eager to cut ties to the bailout program, known as the Troubled Asset Relief Program, or TARP, to escape various restrictions imposed on banks receiving support. Those include limits on executive compensation.

Wells Fargo shares fell 55 cents, or 1.8 percent, to $30.04 in premarket trading.