Pimco, Fidelity to join SIV rescue fund - Draghi
Fri Oct 19, 2007 9:08pm EDT
WASHINGTON, Oct 19 (Reuters) - Investment fund giants PIMCO and Fidelity have joined the so-called super SIV fund set up by three big U.S. banks, boosting confidence in the plan, Bank of Italy Governor Mario Draghi said on Friday.
Draghi said U.S. Treasury Secretary Henry Paulson had discussed the fund with officials attending the G7 meeting of central bankers and finance ministers.
"Paulson has done a short briefing on the SIV fund," Draghi told journalists at the close of the G7 meeting. "PIMCO and Fidelity have joined."
Bank of America Corp (BAC.N: Quote, Profile, Research), Citigroup Inc (C.N: Quote, Profile, Research) and JPMorgan Chase & Co (JPM.N: Quote, Profile, Research) said on Monday they plan a fund aimed at preventing the dumping of billions of dollars of bonds within Structured Investment Vehicles (SIVs) and linked to subprime mortgages and other debt.
PIMCO is the world's biggest bond fund and Fidelity is the world's biggest mutual funds firm. Calls to Fidelty and PIMCO were not immediately returned.
PIMCO's support for the super SIV fund comes as a surprise after Bill Gross, the chief investment officer of Pacific Investment Management Co. or PIMCO, criticised the effort as "a little lame" in a television interview.
Draghi, however, said the presence of the two giants would boost confidence.
"Some have criticised the fund because they think it could be a way to delay the realisation of losses but with the presence of PIMCO and Fidelity, we are more confident," he said.
"We know that it will take a lot of time and work to get the fund working."
Link; reuters.com |
