The Obama administration Saturday continued to work on the details of a wide-ranging plan to stabilize the financial system set to be unveiled Tuesday.
Thus far the government has only said that Treasury Secretary Geithner will lay out a "strategy to strengthen our economy by getting credit flowing again to families and businesses."
CNBC has learned, however, that officials are likely to indicate that the government has approved capital injections to insurance companies with thrift-structured lending units that have applied for government aid under the TARP program.
Thus far only AIG has received funding under the program, but that happened after the government amended various terms of its original aid package, which came in the emergency environment of last September before the TARP was created.
If the Treasury does take such a step with insurance companies, Genworth Financial, Lincoln Nationaland Hartford Financial Services Groupwould be first, according to the source.
The announcemement will also cover a number of aid measures to financial firms, including the purchase of toxic assets at the heart of the crisis, a revised cash-for-equity program and government guarantees on other bad assets held in firms, according to a source familiar with the government's planning.
Funding for the plan is understood to be coming from the second $350 billion of the TARP. It's unclear if that money would cover all the initiatives, new and existing, including the capital injections, known as the PCP, to the guarantees, known as a ring fence or backstop.
Various sources have given CNBC different sums. Late Friday, sources told CNBC that it could involve the purchase of as much as $500 billion in troubled assets from financial institutions. It was unclear, however, where that money would come from. In addition, every bank would be subject to a uniform "stress test" to see if the bank needs additional capital, according to a person briefed on the matter.
Aid to Small Businesses, Consumers
The government is also known to be working on a group of measures to aid small business and consumers, including programs to support the housing market—from interest-rate subsidies to home foreclosure relief. Those subjects, as well as new rules on transparency for firms receiving government aid, have been discussed in the last week, according to a source.