By V. Phani Kumar

Asian banking and financial shares were mostly higher Monday as investors awaited the release of a U.S. plan to stabilize the financial system, although hopes were laced with concerns that market intervention by Washington could spark inflation.

The advance extended the market's strong performance last week, and as investors await U.S. Treasury Secretary Timothy Geithner's briefing to unveil details of the new plan, scheduled for 8:45 a.m. Eastern time.

A Wall Street Journal report late Sunday cited U.S. Treasury Secretary Timothy Geithner as saying that the only way to resolve the financial crisis was to work with the private sector to remove troubled assets clogging banks' balance sheets.

Francis Lun, a general manager at Fulbright Securities in Hong Kong, said that while Geithner's plan might influence Wall Street in a big way, Asian markets were still worried about the impact of the Federal Reserve's separate plan to buy longer-dated U.S. Treasurys.

"Markets will be more concerned that [Fed Chairman Ben] Bernanke is introducing another $300 billion to buy longer-term debt, thereby increasing money supply and increasing the risk of inflation," Lun said.

Most Asian currencies rebounded strongly against the U.S. dollar last week after Bernanke detailed plans to buy the longer-dated U.S. debt, with the greenback's weakness also spurring sharp gains in crude-oil and gold prices.

But hopeful anticipation of the new Geithner plan overcame those concerns about possible inflation from the Fed action. Shares of Sumitomo Mitsui Financial Group (SMFJY) jumped 4% in Tokyo morning trading Monday, while Mitsubishi UFJ Financial Group (MTU) shares gained 2.7%.

The gains in Japanese shares came despite a downbeat business sentiment survey released by the Japanese government Monday, which posted a headline result of negative 51.3 in the first quarter of this year, well below the negative 35.7 seen in the previous quarter.

In the broader markets, the Nikkei 225 Average was up 2% at 8,104.48 in late morning trade, while Australia's S&P/ASX 200 gained 1.4%. Hong Kong's Hang Seng Index added 2% in the early action, China's Shanghai Composite slipped 0.1% and Singapore's Straits Times Index gained 1.1%.

May crude-oil futures were at $52.49 a barrel in electronic trading, up 42 cents from their finish on the New York Mercantile Exchange. April gold futures, meanwhile, slipped $4.60 to $951.60. The contract dropped $2.60 on the Nymex Friday, after rising nearly 8% in the previous session.