Legg Mason Inc., a Baltimore money manager, has obtained a letter of credit for up to $150 million to support its investment holding in a money market fund.
The company, one of the industry's first to acknowledge it provided aid to funds last year so that investors would not lose money, said Friday that the capital infusion from a "large bank" will force it to report a pretax noncash charge of about $142 million. After adjustments for incentive compensation and taxes, the charge will be $59 million, or 41 cents a share.
Legg Mason said that it received the letter of credit to support its holdings in Cheyne Finance, a U.K. structured investment vehicle.
A growing number of financial services companies are adding capital to salvage SIV holdings.
Legg Mason had $998 billion of assets under management as of Dec. 31.
