Two reasons, actually. 1.) Because, as I note in my piece this week, there's evidence that the banks--at least the four biggest ones--are semi-delusional about the size of the losses they still face. Historically, the banks themselves have been about the worst source you can find for an honest assessment of their own financial situation.
2.) Because, as the Times notes in its TARP repayment piece today, the race to return TARP money seems much more about seizing a competitive advantage and identifying oneself as a "healthy bank" than actually, you know, being a healthy bank. (Well, that an wriggling out of government-mandated pay restrictions.) From the Times:
New details emerged Tuesday about the repayment plans, including word that regulators would refuse to let a single major bank exit first, which might have given that institution considerable bragging rights. Instead, around June 8, the Federal Reserve expects to identify a group of banks that are ready to leave the bailout program, according to a Federal Reserve official...
The government owns warrants that give it the right to buy shares in the banks, and must now decide how much banks will have to pay to buy those warrants back. Stronger banks like Goldman favor a hefty price. Banks with less cash on hand want to expunge the warrants cheaply.
The fact that the banks are so preoccupied with "bragging rights" and so eager to somewhat disadvantage themselves if it means hugely disadvantaging rivals does not inspire confidence in their judgment about underlying soundness.