10 Dec 2009

US bank bail-out scheme extended

8:10 am on 10 December 2009

The $US700 billion financial bail-out fund in the United States is to be extended until October next year.

US Treasury Secretary Timothy Geithner said the extension was "necessary to assist American families and stabilise financial markets", he said in a letter to congressional leaders.

But he pledged to deploy no more than $US550 billion of it.

The BBC reports the bail-out scheme was scheduled to expire at the end of the year but will now run until 3 October, 2010.

The Troubled Asset Relief Program was established in the last few weeks of the Bush administration.

Money from the fund has helped rescue Wall Street banks, car makers and other companies.

Mr Geithner confirmed that the long-term cost of TARP would be $US200 billion less than the previous Treasury forecast of $US341 billion.