Treasury Secretary Timothy Geithner said on Wednesday an overhaul of financial regulations was at a critical moment and said he believed a legislative agreement was close.

Geithner, briefing reporters at the White House after President Barack Obama met congressional leaders, also said the U.S. economy was recovering faster than expected and emerging from recession faster than other global economies.

Geithner spoke mostly about the financial regulation debate. I think it's a critical moment for reform, a promising moment, a lot of hard work, a lot of progress, he said.

Rejecting a key Republican argument, Geithner said Obama would not support a financial regulatory bill that creates the risk of perpetual bailouts. He said the administration would continue to listen to Republican ideas.

As for Republican complaints that the Democratic legislation does not address the need to reform housing finance giants Fannie Mae and Freddie Mac, Geithner said the decision not to include that issue in the bill was deliberate.

He said the issue is starting to be addressed now.

Geithner also said the Obama administration felt that any financial regulation bill must bring derivatives out of the dark.

(Reporting by Caren Bohan and Ross Colvin, editing by Jackie Frank)