Whistlejacket Could Add to Fund Advisor Support Tab; Dresdner Backs K2. First the bad news. Yesterday, reports hit that the $7 billion Whistlejacket SIV had been forced into receivership and possibly default. This raises the possibility that more advisors could be forced to purchase or protect the SIVs troubled securities from any money funds still holding this debt. Crane Data counts at least six advisors that hold this name in their most recent filings, but only one shows a maturity date lasting into 2008. Standard & Poor's listed Whistlejacket as the 7th largest SIV held by rated money market funds with $1.95 billion in exposure in a November 2007 research piece (the number almost certainly has declined since). Though reports (see Bloomberg, Orange County Register, Wall Steet Journal, and Financial Times) indicate that parent Standard Chartered has walked away from its pledge to support the debt, this is unclear at present. Nonetheless, funds may have already taken steps, or may be in the process of doing so, to protect any AAA ratings and to assuage their investor bases. In other news, Allianz subsidiary Dresdner Bank has announced that it will support its structured investment vehicle, the much larger ($18 billion) K2. (See WSJ, MarketWatch and Bloomberg articles.) Dresdner joins Citi (Beta, Five, Sedna), HSBC (Cullinan), Bank of Montreal (Links), and WestLB (Harrier) in pledging support for affiliated SIVs; Standard Chartered had pledged support but the recent receivership has thrown this into question.

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