Bank Of Canada Didn't Consider ABCP Bailout

In some of the most detailed comments yet from a Canadian central bank official on the Bank's role in the ABCP fracas, Carney said it acted as a "light-touch" facilitator for talks between various market participants. "We became involved in this situation in a very light-touch way because there was a huge coordination problem in August when the problems emerged between the various players -- the banks, the derivatives counterparties, the investors. "There was a real risk of a fire-sale with very, very low recoveries to the investors," Carney said after delivering his first speech since becoming Bank of Canada Governor on February 1. Canada's ABCP market, for paper issued by groups other than the country's big banks, ground to a halt six months ago when investors suddenly stopped buying the investments on concerns they were invested in U.S. subprime mortgages. ... http://ca.news.yahoo.com/s/reuters/080218/business/business_economy_abcp_col

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