French lender BNP Paribas said on Thursday that it would reopen three funds next week that it had frozen two weeks ago because of 'the complete evaporation of liquidity' in the market. The French bank said that 'conditions have returned to resume the valuation of the liquidity of the three funds, as well as the emissions and redemptions from these funds'.
French lender BNP Paribas said on Thursday that it would reopen three funds next week that it had frozen two weeks ago because of 'the complete evaporation of liquidity' in the market. The French bank said that 'conditions have returned to resume the valuation of the liquidity of the three funds, as well as the emissions and redemptions from these funds'.
The three asset-backed securities funds, BNP Paribas ABS Euribor, BNP ABS Eonia and Parvest Dynamic ABS, should reopen on Tuesday, the Paris-based lender added. The funds shed 23% of their value from July 27 to August 7, falling to some EUR 1.6 bn from about EUR 2 bn.
BNP said it expected the value of the funds to be down between 2% and 5% compared with August 7, but added that this could change after resumption of trading next week. BNP Paribas also said that the three funds were invested, on average, more than 90% 'in AAA and AA notes, which have not suffered from any rating downgrade or payment difficulties and their current valuation was related to the illiquidity of the market.'
On Friday, four of Asia's largest banks revealed exposure to the US subprime mortgage crisis, including the state-run Bank of China which said it held close to $9.7 bn of securities backed by US subprime loans, Bloomberg reported.
