U.S. Treasury Department started buying $40 billion in assets from banks

The U.S. got started its plan to help buy as much as $40 billion in assets from banks without Pacific investment Management Co., the world’s biggest bond manager and an early supporter. Thus, yesterday the U.S. Treasury Department gathered nine money managers for the Public-Private investment program, or PPIP, including BlackRock Inc. and Invesco Ltd. Pimco, which withdrew its application in June because of “uncertainties” about the plan’s design. The government will invest as much as $30 billion and the nine participants may raise $10 billion or more.

Pimco manages $756 billion in assets, including the largest bond fund, Pimco Total Return. The company was selected to manage other programs for the government, including one to purchase mortgage-backed securities.

Besides, the 19 largest U.S. banks have raised more than $100 billion since March by selling equity, debt and assets, and some have repaid government rescue funds, easing concerns that they couldn’t handle a severe recession. The Federal Reserve has trimmed its emergency programs as the financial crisis has lessened.

Bobbie Collins, a BlackRock spokeswoman, said that New York-based BlackRock plans to raise $4 billion to $5 billion from investors. The move came after Pimco`s withdrawal opened the field to competitors. The company is eligible for as much as $1.1 billion in government funds.

The Treasury requires companies to raise at least $500 million from private investors within 12 weeks to participate.