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Funds News

UPDATE 1-SuperSIV fund now seen only $30 bln in size-CNBC

(Recasts; adds background, details)

NEW YORK, Dec 11 (Reuters) - A banking industry fund to bail out structured investment vehicles reeling from the subprime mortgage crisis may only total $30 billion, down from recent estimates of $60 billion, CNBC reported on Tuesday.

Bankers working on the fund said “if they’re lucky,” they may get $30 billion in SIV assets in the fund, said CNBC reporter Charles Gasparino.

SIVs are off-balance-sheet funds used by banks to buy high-yielding assets like U.S. mortgages. They have run into trouble this year as investor interest has dried up, raising fears of a massive fire sale of SIV assets.

Citigroup Inc C.N, Bank of America BAC.N and JPMorgan Chase & Co JPM.N have been trying to launch a fund to prevent such a sell-off.

But the fund, dubbed the “SuperSIV,” has faced skepticism from market players who have said that since the fund will buy only high-quality assets, it will not be able to help weaker SIVs.

Moreover, several European banks like HSBC Holdings Plc HSBA.L and Rabobank [RABN.UL] are moving on their own to bail out their respective funds, making the Citi-led SuperSIV less necessary. (Reporting by Dena Aubin; editing by Gary Crosse)

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