Carlyle Capital liquidity threatened by margin calls; company in talks with lenders

By Caroline Salls

Pittsburgh, March 7 - Carlyle Capital Corp. Ltd. is in discussions with its lenders on its financing situation after the company received additional margin calls and default notices from its lenders, according to a company news release.

Although it believed last week that it had sufficient liquidity, Carlyle said it was informed by its lenders this week that additional margin calls and increased collateral requirements would be significant.

Carlyle said the additional margin calls and increased collateral requirements could quickly deplete its liquidity and impair its capital.

The company said it was notified that some of its RMBS securities had been liquidated by lenders who had previously issued default notices to the company, and additional securities may be liquidated by the lenders.

According to the release, there has been a rapid and severe deterioration in the market for U.S. government agency AAA-rated residential mortgage-backed securities in the past several days.

Based on the weakened market, several of Carlyle's lenders marked down the value of its RMBS securities and informed the company that they would increase their collateral requirements.

The company said its management is closely monitoring the situation and considering all available options.

Carlyle Capital is a Guernsey investment company managed by Carlyle Group affiliate Carlyle Investment Management LLC.

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