Support gathers pace for SIV rescue plan
Support for SIV superfund grows
A plan for a $75 billion rescue plan for troubled funds called structured investment vehicles (SIVs) appears to be gaining support among sceptical institutions, the Financial Times reported on Monday.
The newspaper quoted an unidentified executive at a Wall Street bank as saying that yields on bank debt were already high and could put further downward pressure on the economy.
"The (superfund) could help prevent that and it is gaining wider support," the executive, whose bank was not part of the plan, was quoted as saying.
Fears that SIVs might be forced to dump debt on the market and further depress prices, setting off a downward spiral, have been a factor behind the SIV rescue plan.
Deutsche Bank Americas CEO Seth Waugh said on Friday the SIV rescue plan was "not quite there yet".
Citigroup,Bank of America and JP Morgan Chase are setting up the Treasury-backed plan, called the Master Liquidity Enhancement Conduit (M-LEC), dubbed the "SuperSIV".
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posted by Victor Lloyd Smith @ 10:12 AM
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