Mizuho Securities has started working on a SIV-lite program backed by leveraged loans. The structure was done in response to client's demand, Rekeda said, looking for more term notes as opposed to evergreen participation with puttable options.

Mizuho declined the give the name of the vehicle, but said it is a relatively new product for the market, Alexander Rekeda, head of structured credit, said on a conference call this morning.

"I have not seen a lot of SIV lites backed by leveraged loan collateral. SIV in general is an evergreen vehicle but this lite structure is more of a term vehicle where you know what the maturity is," Rekeda said.

Hoping to capitalize on demand from Asian investors for term notes, the bank is considering floating a considerable amount of capital notes in Japanese yen.

"Given the specifics of our banks, we have some clients in that part of the world that are interested in the product." Mizuho expected the vehicle to come to fruition in four to five months.

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