Shanghai Daily: Business - shanghaidaily.com
CITIGROUP Inc will take over seven troubled investment funds and assume US$58 billion of debt to avoid forced asset sales that would further erode confidence in capital markets. Moody's Investors Service lowered the bank's credit ratings. The biggest US bank by assets will rescue the so-called structured investment vehicles, or SIVs, taking responsibility for their US$49 billion of assets, the New York-based company said in a statement. Citigroup follows HSBC Holdings Plc, Societe Generale SA and WestLB AG in bailing out SIVs to avert fire sales of assets, Bloomberg News reported. The funds, which sell short-term debt and invest the proceeds in higher-yielding securities, have cut their holdings by more than 25 percent since August to US$298 billion, according to Moody's. The decline may reduce the urgency for a bailout sponsored by the US Treasury, Citigroup, Bank of America Corp and JPMorgan Chase & Co. "That was really the last major outstanding piece of the SIV