Word is that Herb Allison, a longtime Wall Street executive with ties to Treasury Secretary Timothy Geithner, as well as to the GOP, will be tapped to head the government’s $700-billion financial rescue program.
President Obama may nominate Allison as early as this week as assistant Treasury Secretary in charge of the TARP program, according to the Washington Post and the Wall Street Journal .
“He will be asked by Obama,” an unnamed financial industry executive told the Washington Post.
Allison, 65, has been close to Geithner for years, since he served on an advisory committee to the Federal Reserve Bank of New York, which Geithner headed, according to the Post.
He also ran the finance committee for Senator John McCain’s 2000 presidential campaign.
In September, Allison agreed to run Fannie Mae for no salary or bonus, after the U.S. took over the mortgage giant and its sister firm, Freddie Mac. He is the former chairman of investment company TIAA-CREF and was a Merrill Lynch & Co. executive for almost 30 years, serving as president and chief operating officer. Allison left Merrill Lynch in 1999, long before the company’s fortunes soured as a result of the subprime mortgage crisis.
The Journal said that Geithner has been searching for months for someone to run TARP. Various candidates either have not made it through the vetting process or have pulled out. Last month, the leading candidate, hedge-fund manager Frank Brosens, withdrew for personal reasons.
Allison, who began his career at Merrill Lynch in 1971, and worked for the company in New York, London, Paris and Tehran, had been on Treasury’s short list from the beginning. If nominated and confirmed by the Senate, he would replace Neel Kashkari, a holdover from the Bush administration, who Geithner asked to stay on until a replacement was found.
After getting a degree in philosophy from Yale, Allison served as a Navy officer in Vietnam, then earned a master’s degree in business administration from Stanford. He serves on advisory boards to both Yale and Stanford’s management schools.
His selection would leave the administration searching for permanent leaders of both Fannie and Freddie. David Moffett, Freddie’s CEO, announced his resignation last month.
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