The Pan-Canadian Investors Committee for Third Party Structured Asset Backed Commercial Paper has been given more time to try and rehabilitate the $40 billion of troubled asset-backed commercial paper that sparked the recent credit crunch in Canada.
The deadline, which was set to expire Monday, has been extended to mid-December.
“The extension of our standstill agreement reflects the high level of co-operation that we have achieved with all parties, including the bank counter parties, as we continue to work together towards a solution which will maximize the value of third-party ABCP,” said Purdy Crawford, chairman of the Investors Committee, in a news release.
“We intend to provide investors with definitive restructuring proposals for each affected conduit prior to the expiry of our extended standstill. We understand that many investors have a pressing need for liquidity and this remains a high priority for us,” Crawford added.
The Investors Committee said Monday the new December deadline includes the following arrangements:
- Members of investment committee agree not to enforce any default rights they may have against the issuer conduits;
- Asset providers will not pursue any existing margin calls or make any further margin calls during the extended standstill period;
- Conduits encouraged not to pursue any existing liquidity calls during or make any further liquidity calls for 150 days after new deadline.