Commercial paper said to get sweeter

NEW YORK (CNNMoney.com) -- Facing a sizeable amount of commercial paper due for renewal, banks and other issuers are sweetening offers to lure skittish investors back in, according to a report published Monday.

Besides paying higher yields, issuers are disclosing exposure to subprime loan assets and taking steps to prevent a selloff of their assets in an effort to heighten investor interest, according to the Wall Street Journal.

The market for commercial paper, which are loans issued to raise money for short periods of time, has been particularly hard hit amid the recent subprime and larger credit market crisis. The asset-backed commercial-paper market contracted by nearly $200 billion from July to the end of August, according to the paper.

And September is gearing up to be particularly busy for the commercial paper market, the Journal reported. Next week alone, about $120 billion of commercial paper is due for renewal outside the U.S.

Even amid some signs that the market may be improving, many investors have been hesitant to wade back into the commercial paper market until big banks such as Citigroup (Charts, Fortune 500) and Deutsche Bank (Charts) report third-quarter earnings and more details about their exposure to the recent subprime crisis.

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