The U.S. Treasury announced Monday that as part of its ongoing efforts to wind down and recover its remaining Capital Purchase Program (CPP) holdings, it is going to sell the investments it made to 12 banks including Diamond Bankcorp, which operates the Bank of Washington.

The Bank of Washington was issued $20,445,000 in 2009 under the CPP which was part of the Emergency Economic Stabilization Act which also included the Troubled Asset Relief Program (TARP).

According to the press release, the CPP securities will be sold at an auction on July 23.

Matt Anderson, a spokesperson for the Treasury Department, said the sale is part of an overall goal to wind up the CPP program.

“Our strategy to achieve that goal is by selling the securities to third parties which allows us to exit the program but still ultimately benefits the community banks who took part in the program,” he said Monday.

Anderson declined to comment specifically on the Bank of Washington holdings but did say the bank was current on its interest payments on the debt it secured under the program.

According to the press release, TARP’s bank programs have already earned a significant profit for taxpayers. To date, Treasury has recoved $264 billion from TARP’s bank programs through repayments, dividends, interest and other income — compared to the $245 billion initially invested. The Treasury has remaining CPP investments in 325 banks.

A treasury blog post from May included this statement on the TARP program.

“Indeed, while cost is not the measure of success, it’s important to note that TARP’s bank programs have already yielded a significant positive return for taxpayers. All told, we invested $245 billion and have already recovered $264 billion through repayments and other income — representing a $19 billion positive return.”

Bank of Washington officials declined to comment on the sale of the CPP obligations citing a gag order instituted by the Treasury Department.

According to the St. Louis Business Journal, the Treasury sold its holdings in Pulaski Financial Corp. — which operates Pulaski Bank in St. Louis — last month. The bank received $32.5 million in exchange for preferred stock in 2009 as part of the Troubled Asset Relief Program or TARP.

It’s all part of the federal government’s efforts to exit TARP. “The Treasury is picking the banks that are the most salable and trying to entice investors to take them off their hands,” Gary Douglass, chief executive of Pulaski Bank, told the Business Journal recently.