Caution at Cairn

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Credit manager Cairn Capital made headlines in August when it was forced to restructure its High Grade Funding I structured investment vehicle (SIV) in the face of the evaporation of the asset-backed commercial paper market. The £800 million restructuring, now complete, succeeded - but at the cost of rebuilding the vehicle into a term-funded structure, essentially a collateralised debt obligation (CDO).

The decision marked the effective end of the SIV business. Paul Campbell, chief executive of

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