US Treasury eager to extend Tarp into next year

(From the Financial Times) The Obama administration is leaning towards extending the troubled asset relief program into next year, retaining part of the $700bn war chest in case of another financial emergency.

Although no final decision has been made, officials in the Treasury are wary of letting the fund expire as scheduled at the end of the year and are seeking to allay criticisms and fears about the future use of Tarp, which has been tapped to provide capital injections in a variety of companies from Citigroup to General Motors.

The financial system has stabilized since Tarp was first used last year and banks such as Goldman Sachs and JPMorgan Chase have repaid the government.

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