Carlyle Capital in default to lender

New York -- Margin calls sent to New York's Carlyle Capital sent ripples of concern to investors Friday as banks asked the private equity to shore up its accounts.

Not unlike a bank telling homeowners that the falling value of their home had pushed loans into risky territory, banks warned the investment group that it needed to add money to reserves. Carlyle Capital was also in default to at least one lender, the company said.

"Just getting a margin call is not that big a deal," associate professor of finance at Georgetown University James J. Angel told The Washington Post. Carlyle Capital "may have losses on paper at the present," he said, "but it could be a very good investment in the long run.

The firm has committed $670 million in cash equity to finance $21.7 billion worth of securities issued by Freddie Mac and Fannie Mae, the paper said.

The ratio of its investment to the size of its loans is considered risky, analysts said.

In Europe, trading in the company's shares was temporarily suspended Thursday
after stock prices fell 58 percent to $5 per share.

Carlyle Capital is listed on the Amsterdam Exchange as Euronext.

Copyright 2008 by United Press International.