Should Morgan Stanley (MS) Be Allowed To Repay TARP?

According to CNBC's Charlie Gasparino, Morgan Stanley (NYSE: MS) has sought preliminary approval to repay TARP. Should they be approved?

Based on the results of the recent stress tests, Morgan Stanley had a capital buffer shortfall of $1.8 billion. Morgan Stanley recently bolstered its capital base by $8 billion from selling common shares and debt.

So based on this, the company has more than covered the $1.8 billion capital buffer shortfall, but by repaying its $10 billion in TARP this may put the company back in the grey area. It is not clear if they will or should get the approval.

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