Banks across the U.S. released fourth-quarter numbers last week, and for many of them the earnings announcement was an opportunity to tout new loans they’ve put on the books in the wake of accepting millions of dollars in federal capital.

The new capital is part of what ultimately will be a $700 billion rescue effort for the banking system on the part of the U.S.

Treasury. Government money is being sent out to hundreds of banks that are determined to be relatively healthy.

Ideally, those banks would turn around and use that money to make more loans.

As ranked by deposits, four of the five largest banks with a presence in Memphis have accepted the federal cash. But along with their quarterly reports this month, the accounting they each gave in the past two weeks of how the Treasury program has affected their loan activity over the past three months was revealing as well as lacking in specifics.

Surface information

It was revealing that the four banks – First Horizon National Corp., SunTrust Banks Inc., Regions Financial Corp. and Bank of America Corp. – all said they were able to originate billions of dollars in new loans in the fourth quarter because of the Treasury program.

Memphis-based First Horizon, for example, said the Treasury program – known as TARP, which stands for Troubled Asset Relief Program – allowed the bank to make more than $900 million in new loans in the fourth quarter. The Memphis bank, which got an $867 million investment of new capital from the government, says it originated more than 2,300 new consumer loans totaling $155 million and 600 mortgage loans totaling $90 million in the fourth quarter.

Loans to small businesses and commercial clients totaled $680 million. First Horizon has the largest slice of the banking market in the Memphis area.

“With an even stronger capital position, we’ve begun leveraging the Treasury funds through prudent business and consumer lending in our core banking franchise,” said First Horizon CFO William “BJ” Losch during the company’s fourth quarter earnings conference call. “We’re able to support commercial customers with their credit needs while maintaining consistent standards of credit-worthiness.”

Similarly, Alabama-based Regions Bank – which got $3.5 billion in TARP money – said it originated $12 billion in new or renewed loans in the fourth quarter. That included 22,000 home loans and other consumer loans totaling $1.3 billion, and 13,000 loans to businesses totaling $10.4 billion.

North Carolina-based Bank of America – which got $45 billion in TARP funds – reported that the company extended more than $115 billion in new credit in the fourth quarter. A breakdown of that lending activity shows the bank originated $11.3 billion in mortgages to low- and moderate-income borrowers.

And Georgia-based SunTrust, which got about $4.9 billion in TARP money, said its total average loans outstanding in the fourth quarter rose by $2 billion. The bank estimates it extended about $14 billion in new credit to consumers and businesses.

“One of the questions we get a lot is, ‘Are you still lending money?’ We’re absolutely still lending money,” said Jordan Barre, vice president of sales and marketing for SunTrust Memphis. “Is it as easy to get now as it was two years ago, in terms of a debt-to-income ratio and things like that? Probably not. And I think maybe rightly so.”

But whither has it gone?

While the above answers in some ways were revealing, they also lacked specifics on a larger point: What exactly are the banks doing with the individual TARP dollars?

Critics of the way the federal money has been handed out say it’s almost impossible to judge the wisdom of that move, since essentially all of the banks aren’t tracking where and how the specific TARP dollars are flowing through their companies. While the four largest banks with a presence in Memphis that have accepted TARP funds have begun reporting an increase in loan activity because of TARP, they haven’t yet shown where the actual TARP money has gone.

The headline of a December Associated Press story went so far as to frame the issue this way: “Where’d the Bailout Money Go? Shhhh, It’s a Secret.”

The most recent report issued this month by the congressional oversight panel monitoring the $700 billion rescue effort notes this issue and argued that banks can do a better job of giving detailed explanations of what they’re doing with the TARP money – not just what the money is allowing them to do.

“It may be difficult to view the impact of the funds at the institutional level and difficult to make comparisons among institutions, but it is possible for the institutions to provide an accounting of where dollars flowed within their organizations and when they first left those organizations through loans, dividend repayments, executive compensation, purchase of other assets, etc.,” the report reads.

First Horizon is the largest local banking player that has been given a dose of federal funds, and its executives argue they’re using the money how the government intended it to be used.

“What we can look at is are we making our best and concerted efforts to make all the loans we can? Yes,” said Dave Miller, director of investor relations for First Horizon. “Are we making sure we participate in the recovery of the communities we live in by lending money and by opening new locations and hiring people? Yes. Are we still, as we’re lending that money, trying to make sure we make good risk management decisions and lend money to people who have the capacity to pay it back to us? Absolutely.”