Treasury Secretary Timothy Geithner was speaking at the TARP’s Congressional Oversign Panel on Tuesday.

He stated that most banks in the United States have more available capital than they currently need but the current volatility and uncertainty of the banking system are causing these institutions to take a more conservative stance when granting loans.

He also stated that the cash that has been paid into the toxic debt market has been a factor in helping to determine the values of securities that have been previously deemed illiquid. It was the uncertainty behind the actual value of these assets that was another reason for making it difficult for banks to raise capital.

In a letter he sent to the panel on Monday, Treasury Secretary Geithner said that his department projects that $25 billion of the $109.6 billion of the TARP fund will be repaid over the next year. The TARP currently effectively has $134.6 billion. This project, according to him, was a conservative estimate that is backed by private analysis.

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