Today, Treasury Secretary Paulson provided an update on implementation of the Emergency Economic Stabilization Act of 2008 (EESA). He announced the Treasury Department and Federal Reserve’s joint program to support consumer financing by creating a facility to finance non-mortgage asset-backed paper, under which Treasury will allocate $20 billion of TARP funding to provide credit protection to the Federal Reserve in connection with its $200 billion Term Asset Backed Securities Loan Facility. He indicated that the facility may be expanded in the future to include additional asset classes necessary to increase the availability of consumer access to lending. Mr. Paulson also discussed the actions taken to stabilize the GSEs and referenced the Federal Reserve’s announcement that it will begin to purchase “direct debt obligations of Fannie Mae, Freddie Mac and the Federal Home Loan Banks, and also the mortgage backed securities guaranteed by Fannie, Freddie and Ginnie Mae” to support the housing market.

Several questions from the media followed, pointedly asking the Secretary about when Treasury will request the additional $350 billion of TARP funding from Congress. In a slight departure from earlier reports that Treasury was inclined to allow the incoming administration to seek the additional funds, Mr. Paulson stated that there was no timeline for approaching Congress to seek approval and release of additional funds for the TARP programs.

This update comes shortly after Treasury’s release of Treasury’s second EESA-required tranche report to Congress, as Treasury has now funded approximately $158.5 billion under TARP. The appendices to the second tranche report list the institutions who have already received funding under the Capital Purchase Program (CPP) and also includes the CPP term sheet for privately held qualifying financial institutions. The tranche report notes that on November 10th, Treasury announced an agreement in principle with AIG for a $40 billion purchase of preferred shares, but that transaction is not yet funded, so information regarding that transaction will be reported in the next tranche report.