Treasury Signals Intent To Invest Directly In Banks

WASHINGTON–The Treasury Department yesterday signaled its intent to purchase ownership stakes in banks.Such direct investment in banks would previously have been unthinkable, but the scope of the financial crisis is pushing regulators to move into areas they otherwise would have avoided. Details of how this will work are expected to be released soon.With precious few implementation details on offer, speculation about what other tools regulators might use to stanch the financial bloodletting abounds.Among some of the ideas being bandied about include government easing restrictions on companies that can own banks, issuing government guarantees for interbank loans ordering emergency audits of large institutions and improving loan modification efforts.