This week, the U.S. Treasury announced the much-anticipated details of the Public Private Investment Program (”PPIP”) that was introduced in summary form by Treasury Secretary Timothy Geithner last month.1 The program, which is part of the Obama Administration’s broader “Financial Stability Plan,” focuses on the purchase of what were described as “troubled assets” under the Troubled Assets Relief Program (”TARP”), part of the Emergency Economic Stabilization Act of 2008 (”EESA”) enacted last October. Although the TARP was originally proposed as a purchase program for troubled loans and mortgage-backed securities, the Bush Administration applied the first portion of the TARP proceeds toward direct capital infusions into banking institutions. The objectives of the PPIP are much closer to the original objectives of the TARP: to thaw the nation’s credit markets by moving legacy assets off the balance sheets of financial institutions so those financial institutions can expand their lending activities. For more information click here.

The American Recovery and Reinvestment Act of 2009 (the “Stimulus Act”) modifies and expands upon the executive compensation standards that were originally issued under the Troubled Assets Relief Program (the “TARP”) and incorporates certain aspects of the standards announced by the Treasury earlier this month. The Stimulus Act amends Section 111 of the Emergency Economic Stabilization Act (the “EESA”), the source of the TARP standards, thus applying retroactively to all institutions that already participate in the TARP (e.g., financial institutions that received funds under the Capital Purchase Program).  For more information click here.

The Congressional Oversight Panel (“COP”), which was created pursuant to the Emergency Economic Stabilization Act of 2008 to oversee the Treasury’s Troubled Asset Relief Program and review the current state of financial markets and the regulatory system, released a Special Report on Regulatory Reform (the “COP Report”) in which it analyzed the current financial crisis and made recommendations for the future. The COP Report identified eight specific areas most urgently in need of reform: for more information click here.