US Treasury delays bank bailout announcement

US: The Obama administration on Sunday pushed back until Tuesday the announcement of a keenly awaited bank rescue plan as it pressed lawmakers to settle their differences over a huge economic stimulus package.

“We’re focused on working with Congress to pass an economic recovery bill so we can create the jobs and make the investments necessary to get our economy moving again,” Treasury Department spokesman Isaac Baker said.

The bank rescue plan — which will seek to shore up some of the biggest commercial banks in the United States — had been due to be announced on Monday. But the Senate is now expected to be focused on that day on a massive economic stimulus ahead of a vote on Tuesday. For that reason, Treasury Secretary Timothy Geithner had postponed release of the bank plan until Tuesday, Baker said in a statement.

The stimulus and the bank rescue plan are key parts of President Barack Obama’s strategy for tackling the deepest financial crisis in the United States since the Great Depression.

Shares in major U.S. banks such as Bank of America and Citigroup have been volatile in recent weeks on speculation about the contents of the financial rescue plan.

White House National Economic Council Director Lawrence Summers said the administration wants to keep lawmakers concentrating on the stimulus plan. “There’s a desire to keep the focus right now on the economic recovery program, which is so very, very important,” Summers said on ABC television’s “This Week”.

Summers urged lawmakers to craft quickly a compromise on competing House and Senate versions of the economic stimulus bill that could be worth over $800 billion and which the White House hopes will create 3 million to 4 million jobs.

Even after the Senate votes, the stimulus plan must still go through final House of Representatives and Senate negotiations before it can be sent to President Barack Obama to sign into law.

Treasury chief Geithner had been scheduled to detail on Monday how the administration plans to use the $350 billion remaining of the $700 billion so-called Troubled Asset Relief Program (TARP) financial bailout program.

Banks worldwide have been laid low by huge losses on U.S. mortgage-related debts. The scarcity of credit is choking the U.S. economy, which is mired in a deepening recession.

The Bush administration used the bailout program primarily to inject capital into banks in order to keep them from crumbling.

Obama’s team is now turning its efforts to cleaning up the “toxic” assets clogging the financial system and it is expected to propose a range of measures including further state

Washington, Monday, Reuters