The US Treasury will launch its public/private investment fund program to buy up toxic securities with an initial funding of $20 billion from public and private sources, a level scaled back considerably from initial plans, people familiar with the matter said on Thursday.
Nine funds chosen by the Treasury will raise about $1.1 billion each from private investors, and the Treasury will match that amount with taxpayer dollars, said the sources, who were not authorised to speak publicly about the plan. But they said the announcement and timing of the program's launch remains uncertain, the sources said.
A spokesman for the US Treasury declined to comment. The Public-Private Investment Program, or PPIP, was a key part of the Obama administration's early efforts to shore up a frail banking sector, aiming to cleanse banks' balance sheets of toxic mortgage assets that were choking off lending and eroding confidence in the financial system's viability.
After a sketchy initial outline disappointed markets in Feburary, US Treasury Secretary Timothy Geithner announced ambitious details for the program in March to buy up to $1 trillion of securities and whole bank loans through public-private funds.
Comments
Comments are closed.