U.S. Bancorp and BB&T Corp repaid billions of dollars in government bailout funds on Wednesday, the first of the large banks to do so, ahead of eight others given permission to return the money.

U.S. Bancorp, repaying $6.6 billion, and BB&T, returning $3.1 billion, also said they intend to buy back warrants for their common stock from the U.S. Treasury.

The Treasury said last week that banks repaying bailout funds could also buy back these warrants, which give the government the right to buy common stock at a predetermined price for up to 10 years.

The banks can buy back the warrants at fair market value, the Treasury said. U.S. Bancorp and BB&T did not explain how, when or at what price they would buy back the warrants.

Several other big banks are also expected to make bailout repayments on Wednesday. Goldman Sachs Group has said it will do so, and a person familiar with the situation said Morgan Stanley would, too. Both banks received $10 billion from the Troubled Asset Relief Program.

The Wall Street Journal reported last week that JPMorgan Chase & Co and American Express Co were also expected to repay $25 billion and $3.4 billion, respectively, on Wednesday.

The other big banks that won permission from the government to repay funds received from the Troubled Asset Relief Program are Bank of New York Mellon Corp , Capital One Financial Corp , Northern Trust Corp and State Street Corp .

As a condition of being allowed to repay, banks had to show they could raise money from the private sector both by selling stock and issuing debt without the help of Federal Deposit Insurance Corp guarantees. The Federal Reserve also had to agree that their capital levels were adequate to allow them to continue lending.

At least 22 smaller banks have been allowed to repay some or all of their taxpayer money, although most must still negotiate terms to buy back or extinguish the government's warrants to buy their common stock.

Bank shares slipped broadly on Wednesday. The KBW Banks index <.BKX> was down 4.6 percent in morning trading.

(Reporting by Elinor Comlay; editing by John Wallace)

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