Bear Stearns has been forced to seek emergency funding to stave off insolvency, as the ongoing credit crisis threatened to claim its biggest victim yet.

Shares in the New York investment bank tumbled 8% at the start of trading on Wall Street after it revealed the bailout package, backed by the US Federal Reserve and JP Morgan.

The company admitted that its financial position had "deteriorated sharply" in the last 24 hours.

Bear Stearns had repeatedly denied in recent days that it has a liquidity problem through its exposure to hedge funds, which are currently being squeezed hard by the credit crunch.

According to analysts, Bear Stearns was the biggest buyer and packager of mortgage securities in the boom years. These mortgage-backed assets are at the heart of the credit crunch. Yesterday the Carlyle Capital hedge fund went bust after investing around £11bn in mortgage debt.


See Original Article

We can help get your business debts back under control. If you would like to know more then call us now.

Call us on: 0800 071 1616

Email us on: info@debtsgone.co.uk

Website: www.debtsgone.co.uk