Bear Stearns Plans $3.2 Billion Fund Rescue to Halt Fire Sale
- Thread starter ASusilovic
- Start date
Yeah, Crames is right (I call him "Crames").. This shitstorm is just gonna blow over.
15:26 BSC Bear Stearns' big loss arouses SEC interest - BusinessWeek.com (137.85 -5.90) -Update-
BusinessWeek.com reports Bear Stearns may have a lot of explaining to do about a big restatement of losses at one of its troubled hedge fundsâand not just to its investors. The SEC recently opened a preliminary inquiry into the near-collapse of Bear Stearns' High-Grade Structured Credit Strategies Enhanced Leveraged Fund. People familiar with the inquiry say regulators are interested in learning how the Wall Street investment co came to dramatically restate the April losses for the 10-month-old fund, which invested heavily in securities backed by subprime mortgages, or home loans to consumers with shaky credit histories. Bear Stearns told investors May 15 that the Enhanced Leveraged fund had lost 6.5% in April. But three weeks after that est, the investment co shocked investors on June 7, telling them that the fund's actual April loss was 18.97%, or 23% for the year. Privately, Bear Stearns is spreading the word that the April restatement was prompted by actions by some of their lender banks. People familiar with the matter say the Wall Street co claims the banks began demanding that the hedge fund put up more collateral for the loans it had taken. The banks, on their own accord, began marking down the value of the subprime bonds that the hedge fund had invested in, which had the effect of precipitating the current crisis, according to the people familiar with Bear Stearns' account of the events. To be sure, it's worth noting that the SEC inquiry is so preliminary that regulators have not issued any subpoenas.
15:26 BSC Bear Stearns' big loss arouses SEC interest - BusinessWeek.com (137.85 -5.90) -Update-
BusinessWeek.com reports Bear Stearns may have a lot of explaining to do about a big restatement of losses at one of its troubled hedge fundsâand not just to its investors. The SEC recently opened a preliminary inquiry into the near-collapse of Bear Stearns' High-Grade Structured Credit Strategies Enhanced Leveraged Fund. People familiar with the inquiry say regulators are interested in learning how the Wall Street investment co came to dramatically restate the April losses for the 10-month-old fund, which invested heavily in securities backed by subprime mortgages, or home loans to consumers with shaky credit histories. Bear Stearns told investors May 15 that the Enhanced Leveraged fund had lost 6.5% in April. But three weeks after that est, the investment co shocked investors on June 7, telling them that the fund's actual April loss was 18.97%, or 23% for the year. Privately, Bear Stearns is spreading the word that the April restatement was prompted by actions by some of their lender banks. People familiar with the matter say the Wall Street co claims the banks began demanding that the hedge fund put up more collateral for the loans it had taken. The banks, on their own accord, began marking down the value of the subprime bonds that the hedge fund had invested in, which had the effect of precipitating the current crisis, according to the people familiar with Bear Stearns' account of the events. To be sure, it's worth noting that the SEC inquiry is so preliminary that regulators have not issued any subpoenas.
damn, 40 consecutive quarters of profitable performance and only one loss out of 40 leads to this. Doesnt make much sense. How highly leveraged are they that they took a loss of this magnitude??
The Bear Stearns High-Grade Structured Credit Fund, which was bailed out last week, had had ``something like 40 consecutive quarters of profitable performance'' before the losses, Chief Financial Officer Samuel Molinaro said on a June 22 conference call.
The Bear Stearns High-Grade Structured Credit Fund, which was bailed out last week, had had ``something like 40 consecutive quarters of profitable performance'' before the losses, Chief Financial Officer Samuel Molinaro said on a June 22 conference call.
hehe - another change. I bet this number is going to change (and decrease) at least 10 times in the next few months...
By Jody Shenn and Yalman Onaran
June 25 (Bloomberg) -- Bear Stearns Cos. may put up only
$1.6 billion to rescue one of its money-losing hedge funds, half
as much as it offered last week, according to two people with
knowledge of the situation.
The size of the bailout dropped after the Bear Stearns High-
Grade Structured Credit Fund found buyers for some assets and
creditors sold others, said the people, who declined to be
identified because they aren't authorized to comment for the
firm. Bear Stearns, the biggest U.S. broker to hedge funds, said
June 22 it would assume $3.2 billion of loans to prevent lenders
from liquidating assets.
The reduction means New York-based Bear Stearns won't have
to tie up as much capital to salvage the fund from bad bets on
subprime mortgage bonds and collateralized debt obligations.
Shares of Bear Stearns fell as much as 7.6 percent today as
investors speculated that the funds' tailspin and risks the firm
faces in the mortgage market would reduce earnings....
By Jody Shenn and Yalman Onaran
June 25 (Bloomberg) -- Bear Stearns Cos. may put up only
$1.6 billion to rescue one of its money-losing hedge funds, half
as much as it offered last week, according to two people with
knowledge of the situation.
The size of the bailout dropped after the Bear Stearns High-
Grade Structured Credit Fund found buyers for some assets and
creditors sold others, said the people, who declined to be
identified because they aren't authorized to comment for the
firm. Bear Stearns, the biggest U.S. broker to hedge funds, said
June 22 it would assume $3.2 billion of loans to prevent lenders
from liquidating assets.
The reduction means New York-based Bear Stearns won't have
to tie up as much capital to salvage the fund from bad bets on
subprime mortgage bonds and collateralized debt obligations.
Shares of Bear Stearns fell as much as 7.6 percent today as
investors speculated that the funds' tailspin and risks the firm
faces in the mortgage market would reduce earnings....
lol:
Dear Investor
Just a quick note to let you know that, should you need or wish to have
liquidity, a market has developed for shares in both the High Grade and
High Grade Enhanced hedge funds.
Please feel free to contact us if you would like to discuss this further.
Sincerely,
Anastacia Brooks
Hedgebay Trading Corporation
Dear Investor
Just a quick note to let you know that, should you need or wish to have
liquidity, a market has developed for shares in both the High Grade and
High Grade Enhanced hedge funds.
Please feel free to contact us if you would like to discuss this further.
Sincerely,
Anastacia Brooks
Hedgebay Trading Corporation