June 30 (Bloomberg) -- The U.S. Treasury Department is set to name eight to 10 asset managers for the Public-Private Investment Program as soon as this week, a person familiar with the matter said today.

Once the asset managers have signed deals with Treasury, they each will be expected to raise at least $500 million of private capital within 12 weeks, according to Treasury program documents.

Pacific Investment Management Co. and BlackRock Inc. have been among the leading candidates for the slots. Other companies that have said they applied include Bank of New York Mellon Corp.’s Boston-based Standish bond unit; Atlanta-based Invesco Ltd. and its affiliate, WL Ross & Co.; Baltimore’s Legg Mason Inc.; and TCW Group Inc. in Los Angeles.

BlackRock Chief Executive Officer Laurence Fink said April 21 that the New York-based firm hopes to be one of the asset managers chosen for the program, one component of the Obama administration’s effort to stabilize the U.S. banking system.

Bill Gross, co-chief investment officer for Pimco in Newport Beach, California, described PPIP in March when it was introduced as a “win-win-win” solution for banks, the government and investors. Pimco, a unit of Munich-based Allianz SE, manages $756 billion in bonds.

PPIP’s Legacy Securities program will use matching federal money and funds raised by the selected companies from private investors to buy distressed mortgage-backed securities and other troubled assets from U.S. banks. The purchases are intended to establish market prices for the assets, clean up bank balance sheets, and revitalize lending.

The Treasury said in May that it received more than 100 applications. The department didn’t disclose the names of the candidates, now in line for final approval to set up funds that would buy as much as $1 trillion in hard-to-value securities from banks in partnership with the government.

The Treasury is offering to match capital committed by private investors and provide them with leverage. PPIP includes a separate program to buy whole loans from banks.

To contact the reporters on this story: Rebecca Christie in Washington at Rchristie4@bloomberg.net; Sree Vidya Bhaktavatsalam in Boston at sbhaktavatsa@bloomberg.net.

Last Updated: June 30, 2009 16:25 EDT