Merrill reportedly seizes $400M from fund

Investment bank to auction assets from a Bear Stearns fund after a negative bet on the subprime market.

June 18 2007: 8:02 AM EDT

NEW YORK (CNNMoney.com) -- Merrill Lynch has seized $400 million of its assets from a troubled hedge fund managed by Bear Stearns, the Wall Street Journal reported in its online edition.

Last week, Bear Stearns' (Charts, Fortune 500) High-Grade Structured Credit Strategies Enhanced Leveraged Fund scrambled to sell-off $4 billion in bonds backed by risky subprime mortgages to raise cash and assets for creditors and avoid liquidation, the Journal reported.

The report said the investment bank Merrill Lynch (Charts, Fortune 500) will auction the seized assets Monday at noon, in a move that could spur other lenders to seize funds.

The Bear fund has been hurt by a rebound on a key index that tracks subprime mortgages, the paper said. Top of page

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Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2018 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2018. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2018 and/or its affiliates.