In a surprise move, the U.S. Treasury announced on Tuesday that it has hired investment bank Morgan Stanley to conduct a review of Fannie Mae and Freddie Mac.

Morgan Stanley's duties will involve analyzing the GSEs' authority.

The U.S. Treasury called the move an exercise in "prudent preparedness" and requested the investment bank specifically because of its "financial expertise."

The contract is expected to run through to January 17, 2009.

By Steve Stecyk and edited by Sarah Sussman