Financial Times FT.com

Special vehicle pools could restart markets

By Krishna Guha in Jackson Hole

Published: August 24 2008 20:15 | Last updated: August 24 2008 20:15

Banks may have to pool their troubled mortgage assets into giant special resolution vehicles in order to ringfence past problems and help to restart the financial markets, some central bankers believe.

Such vehicles would be similar in some respects to the aborted “superSIV” proposed by US banks with Treasury backing last year. Governments could provide financial support if needed in return for a share in potential profits once the assets were liquidated.

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