A top U.S. Securities and Exchange Commission official said that regulators remain worried about hard-to-sell assets held by high-yield bond funds as they probe whether the failure of the Third Avenue Focused Credit Fund could be repeated, Bloomberg News reported today. The SEC plans to release findings from a sweep of high-yield credit funds that followed the collapse of the Third Avenue Capital Management LLC fund, said Marc Wyatt, head of the regulator’s office of compliance inspections and examinations. “There is ongoing concern,” Wyatt said on Saturday. The SEC began reviewing about 70 funds in December after the $788.5 million Third Avenue fund blocked clients from getting their money out, said Jane Jarcho, another top SEC examiner. Losses and withdrawals left Third Avenue unable to meet redemptions without selling assets at fire-sale prices. SEC examiners sent letters to funds that invest in similar securities to the Third Avenue fund, ordering them to explain how their bonds could be sold as quickly as they say.
