U.S. officials meet with bank CEOs to finalize financial rescue plan

WASHINGTON -- Administration officials were hammering out the final details Monday to get the recently enacted $700 billion financial rescue plan up-and-running, meeting with bank chiefs and tapping a number of top government officials and private firms to implement the massive program.

Treasury and Fed officials met with CEOs from a number of banks, including Morgan Stanley, Chase and Goldman Sachs, Monday afternoon. "We are bringing them in to finalize details," Treasury spokeswoman Brookly McLaughlin said.

Also Monday, the Federal Reserve and other central banks announced additional steps to keep money flowing in world financial markets, and governments across Europe took a series action to strengthen faltering banks in their own countries.

It is unclear when the details of the Treasury Department program will be announced.

Among other issues, the U.S. government was working on how it would purchase equity in a "broad array" of financial companies, according to Neel Kashkari, the Treasury official tapped last week to head the program. Such a program would quickly give banks cash to shore up their balance sheets and encourage them to lend to each other, other businesses and consumers.

Europe, with its series of actions on Monday, may have set the pattern.

"Washington has no choice but to go largely the same way that Europe and other countries already have — substantial nationalization of the banking sector," Donald Straszheim, vice chairman of Roth Capital Partners, said in a note to clients.

The U.S. government is also hammering out how it will conduct auctions to buy bad mortgage-backed assets in an effort to get the assets off bank books to facilitate lending, which has all but frozen up in recent months. Treasury is also working to design programs to buy mortgages from regional banks, to establish an insurance program for troubled assets and to help people hold on to their homes.

"A program as large and complex as this would normally take months — or even years — to establish. We don't have months or years," Kashkari, a former Goldman Sachs investment banker, said in a speech.