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| Version 2 | Version 3 |
|---|---|
| Hedge fund worries as CCC closes | Hedge fund worries as CCC closes |
| (19 minutes later) | |
| Carlyle Capital Corporation (CCC), a unit of the private equity firm Carlyle Group, has said it will not be able to meet lenders' demands for money. | Carlyle Capital Corporation (CCC), a unit of the private equity firm Carlyle Group, has said it will not be able to meet lenders' demands for money. |
| The US mortgage-backed bond fund will collapse if, as expected, its lenders seize its remaining assets. | The US mortgage-backed bond fund will collapse if, as expected, its lenders seize its remaining assets. |
| CCC's problems are the latest sign of the credit market turmoil that has prompted billions of dollars of losses at some of the world's biggest banks. | CCC's problems are the latest sign of the credit market turmoil that has prompted billions of dollars of losses at some of the world's biggest banks. |
| Other investment funds may now face similar problems, analysts fear. | Other investment funds may now face similar problems, analysts fear. |
| "There will be some very scared people in hedge-fund land today," said BBC business editor Robert Peston. | "There will be some very scared people in hedge-fund land today," said BBC business editor Robert Peston. |
| "Hedge funds that have borrowed from banks against the security of mortgage-backed debt could be about to see their assets sucked into the banking system and their businesses vanish," he added. | "Hedge funds that have borrowed from banks against the security of mortgage-backed debt could be about to see their assets sucked into the banking system and their businesses vanish," he added. |
| 'Whirlwind blowing' | |
| CCC's problems came to a head last week when it became apparent that it was not going to be able to service its debts. | |
| Almost within the blink of an eye, a business that had borrowed $21bn from the world's biggest banks will be gone Robert Peston BBC business editor Read Robert Peston's blog | |
| Some of the banks that had lent CCC money started liquidating assets, and the Dutch-listed fund's shares were suspended. | |
| On Wednesday, CCC said that it had not been able to refinance its business. It said it had so far defaulted on about $16.6bn (£8.1bn) of its debt and the only assets it had left were US government AAA-rated residential mortgage-backed securities. | |
| CCC said it also expected to default on this after the portfolio's value was marked down again on Wednesday. | |
| "Almost within the blink of an eye, a business that had borrowed $21bn from the world's biggest banks to invest in high-quality mortgage-backed securities will be gone, liquidated, kaput," said BBC business editor Robert Peston. | |
| "Such is the whirlwind blowing through global financial markets." | |
| CCC's collapse will lose its clients some $600m. |