Financial Times FT.com

Superfund collapse ‘embarrassing’ to Treasury

By Krishna Guha in Washington and Aline Vandyn in New York

Published: December 23 2007 21:01 | Last updated: December 23 2007 23:43

The collapse of the plan to create a $75bn “superfund” is embarrassing for the US Treasury, which backed the scheme, but is not likely to have big implications for financial markets, analysts and former officials said.

The idea – to create a fund to support liquidity in the market for housing-related securities – was killed off late on Friday when the banks behind the scheme abandoned it after other financial institutions showed little interest.

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