Ambac Financial ( ABK) and other bond insurers are working on a plan to send to the Treasury Department that would enable them to sell troubled assets to the government, Bloomberg reports.

The companies also may present a proposal next week that would allow the insurers to guarantee some assets with government backing, CEO Michael Callen said in a Bloomberg interview.

``We're working hard to put together a proposal and it's got to be an industry proposal,'' Callen said, Bloomberg reports. ``We don't have a lot of time.''

Callen said he isn't asking Treasury to take a stake in Ambac.

The U.S. Treasury said Thursday it isn't considering buying equity holdings in bond insurers, Bloomberg reports.

Five of seven bond insurers, including MBIA ( MBI) and Ambac, lost their top AAA ratings this year as losses surged on securities linked to subprime mortgages, reports Bloomberg.

This article was written by a staff member of TheStreet.com.

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