Northern Trust to prop up SIV-exposed funds
The firm will float as much as $229 million to money market funds it advises that are exposed to structured investment vehicles.
Northern Trust Corp. will float as much as $229 million to money market funds it advises that are exposed to structured investment vehicles.
The eight funds hold notes and other instruments issued by Whistlejacket Capital LLC or White Pine Finance LLC, which are structured investment vehicles, or SIVs.
These vehicles borrow money by issuing short-term securities at low interest, and then lend that money by purchasing long-term securities.
Both SIVs have had their ratings downgraded recently by agencies.
Though Northern Trust was under no obligation to extend the capital offer, it did so in order to provide stability to the funds and their investors, the Chicago-based bank said.
Each capital agreement Northern Trust has made with the funds is set to expire no later than July 31.
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