SIVs continue to creak

The SIV problem is not going away for most banks and managers. About $40 billion in payments will be due soon, and banks and SIV managers must figure out a way to make good on all commitments. The absolute disaster would allow money market funds to "break the buck" en masse. This week, the credit rating of the large independent Victoria SIV was slashed to junk status after being rated AAA just a few months ago, notes the Financial Times. This is just one of many downgrades in a spate that is making lots of people nervous. Lacking a bank sponsor to bail them out, the options for independents like Victoria are few. They'll most likely be forced to write down large parts of their portfolios. Whether significant numbers of retail investors will be hit is unclear.  

For more:
- here's the Financial Times article