British bank Barclays has played down concerns about its exposure to failed investment funds.
It has denied that debt vehicles structured by its investment banking arm have left it with an exposure worth hundreds of millions of dollars.
Barclays Capital has been one of the most innovative players in the debt market, embracing complex investment vehicles known as SIV-lites.
These, however, have increasingly become a focus of investor concern amid recent debt market turmoil that has hit the value of assets underpinning the deals and that has led to short-term funding for them drying up.
Worries this week have focused on an SIV-lite structured and marketed by Barclays Capital for stricken German lender SachsenLB. BarCap, however, said it had provided no funding for the vehicle, Sachsen Funding 1.
The Reuters news agency quoted a source familiar with the structure as saying that Sachsen Funding 1 included a facility whereby Barclays could be tapped for cash if the vehicle ran into trouble, but that had not happened.
