March 5 (Bloomberg) -- U.S. Bancorp and Northern Trust Corp. will return funds from the Treasury’s Troubled Asset Relief Program, according to Representative Barney Frank.

The banks didn’t immediately confirm whether they’d repaid any of the federal money.

Frank, a Massachusetts Democrat and chairman of the House Financial Services Committee, said during a news conference that Northern Trust returned $1.6 billion. He didn’t say whether U.S. Bancorp, the biggest lender based in Minnesota, had formally applied to return its TARP money.

“It shows that things are beginning to stabilize,” Frank said in an interview on CNBC television. “The more money that comes back in the Treasury, the better I like it.”

U.S. Bancorp cut its dividend yesterday and said it wanted to give back the capital obtained from the federal program “as soon as prudently possible.” Spokesman Steve Dale declined to comment on whether the bank had returned any TARP money.

One reason for the dividend cut was “it accelerates our company’s ability to repay the $6.6 billion of TARP capital, something we intend to do as soon as possible with the approval of our regulators,” Dale said.

Calls to Northern Trust’s spokesman Doug Holt and Treasury spokesman Isaac Baker weren’t immediately returned.

To contact the reporter on this story: Linda Shen in New York at lshen21@bloomberg.net

Last Updated: March 5, 2009 13:27 EST