U.S. to Unveil Bank-Investing Plans: Report

The Treasury has selected the law firm Simpson Thatcher to advise on structuring a program to acquire equity stakes in banks, as well as the consultancy Ennis Knupp to hire asset managers.

"[W]e have accomplished a great deal in just 10 days, but our work is only beginning," he said in a speech at the Institute of International Bankers. "A program as large and complex as this would normally take months or even years to establish. We don't have months or years. Hence, we are moving to implement the TARP as quickly as possible while working to ensure high quality execution."

Kashkari also said TARP was taking "aggressive steps" to combat potential conflicts of interest, since companies and individuals who can best help the Treasury are also those who will most need its help.

"[F]irms with the relevant financial expertise may also hold assets that become eligible for sale into the TARP," Kashkari noted.

Firms will be required to submit an outline of any potential conflicts of interest, and the Treasury will then perform its own independent investigation before hiring them. Treasury will only hire firms when "confident in our and their ability to manage any conflicts," Kashkari said.

The TARP will spend up to $700 billion to acquire a wide range of troubled assets that banks have been unable to price or sell, including mortgage-backed securities, as well as whole loans. It will also offer to insure troubled assets or inject capital in exchange for equity stakes in companies. The Treasury is still working on how such capital injections would be structured, though the program will be voluntary. It will also be available to various types of financial firms, both large and small.