The Old Vertical Slice Trick

WhistleJacket reduces holdings by 40% since August in asset sales to capital note holders.

That is a reduction of $7.2 Billion in assets.

Dec. 5 (Bloomberg) -- Whistlejacket Capital Ltd., the structured investment vehicle managed by Standard Chartered Ltd., has sold assets to reduce the fund by 40 percent to $10.8 billion since August.

Whistlejacket sold some of the holdings to bondholders in return for redeeming their notes in so-called vertical slice deals, the London-based bank said in a statement today. Standard Chartered took a $46 million ``temporary writedown'' on $1.68 billion of assets it bought from the SIV.

``It is highly likely that the group will undertake a further vertical slice which will be effected before the end of the year, alongside similar transactions by a number of other capital note holders,'' the bank said in the statement.

Whistlejacket is funded ``into 2008'' Standard Chartered said, without providing further details.