Merrill Sells B&C Assets From Bear Hedge Fund

Merrill Lynch & Co., New York, has seized roughly $800 million in subprime-related assets from at least one Bear Stearns hedge fund and has begun liquidating those assets after margin calls on the fund were not met, investment banking sources have confirmed to MortgageWire.At deadline time, Bear's spokesman had not returned a telephone call about the matter. Merrill declined to comment. Bear Stearns operates two hedge funds -- the High-Grade Structured Credit Strategies Enhanced Leverage Fund, and the High-Grade Structured Credit Strategies Fund -- that have investments in subprime-related assets, including long positions on the ABX Index, sources said. Last winter MW broke the news that Merrill Lynch's warehouse lending group was making margin calls on certain subprime firms, some of which later filed for bankruptcy protection. The companies can be found online at http://www.ml.com and http://www.bearstearns.com.