June 06, 2009

The Obama administration is set to announce next week that a larger-than-expected number of big financial firms can repay their bailout funds, a sign of the government's belief that the banking system is stabilizing, people familiar with the matter said.

The size of the repayments may double the initial estimate of $25 billion by the Treasury Department, the sources said. That would mean that many, perhaps nearly all, of the nine firms that regulators found to have sufficient reserves in a recent "stress test" would be allowed to return federal aid.