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Bear Stearns to receive emergency funding

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  • 14/03/2008
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The Bear Stearns Companies Inc. announced today it reached an agreement with JPMorgan Chase & Co. (JPMC) to provide a secured loan facility for an initial period of up to 28 days allowing Bear Stearns to access liquidity as needed.

JPMC confirmed it is acting with the Federal Reserve Bank to provide emergency secured funding to US investment bank Bear Stearns.

The bank has agreed to provide secured funding to Bear Stearns, for an initial period of up to 28 days.

Bear Stearns also announced that it is talking with JPMC regarding permanent financing or other alternatives.

Alan Schwartz, president and chief executive officer of The Bear Stearns Companies Inc., said: “Bear Stearns has been the subject of a multitude of market rumors regarding our liquidity. We have tried to confront and dispel these rumors and parse fact from fiction. Nevertheless, amidst this market chatter, our liquidity position in the last 24 hours had significantly deteriorated. We took this important step to restore confidence in us in the marketplace, strengthen our liquidity and allow us to continue normal operations.”

In a statement the company said it could make no assurance that any strategic alternatives will be successfully completed.

The company will announce its first quarter 2008 financial results on Monday, March 17, 2008, after the market closes.

It remains unclear how this will impact Bear Stearns’ UK mortgage subsidiary, Rooftop Mortgages.

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