The Bear Stearns Companies Inc. reported that it will only have to use half the financing it established to bail out a troubled hedge fund.

On June 22, Bear Stearns announced it had offered to provide a secured financing facility of up to US$3.2 billion to the High-Grade Structured Credit Fund, a hedge fund managed by Bear Stearns Asset Management. Yesterday, it said, “Due to additional asset sales the actual amount of the facility being provided by Bear Stearns to the High-Grade Fund is approximately US$1.6 billion.”

BSAM continues to work with the creditors and counterparties of its other troubled fund, the High-Grade Structured Credit Enhanced Leverage Fund, to facilitate an orderly de-leveraging of the fund in the marketplace. Remaining outstanding repo balances in this fund are approximately US$1.2 billion. Bear Stearns is not providing any financing to this fund, it said.

“The market situation surrounding these funds is stabilizing and the sales that have taken place have been orderly,” said Rich Marin, CEO of BSAM, in a news release. “We have brought in additional resources with expertise in these asset classes to facilitate the orderly de-leveraging process.”

“By providing this secured financing facility we believe we have helped stabilize and reduce uncertainty in the marketplace. We believe the repurchase agreements are adequately collateralized and we do not expect any material adverse effect on our business as a result of providing this secured financing,” said James Cayne, chairman and chief executive officer of Bear Stearns.

“The sub-prime mortgage market has been challenging for a number of months. Over this time period Bear Stearns’ core trading and capital markets businesses have managed this risk well. We see no material change in our risk profile or counterparty exposure as a result of the reaction in the marketplace regarding the situation surrounding these hedge funds,” Cayne added. “We will continue to adjust and respond to changing market conditions as appropriate and as we have throughout our 84 year history.”