SCOTTSDALE, Ariz. - The most popular buzzword at last week's SRI conference was "SIVs," or structured investment vehicles, and many firms seeking alternatives to traditional commercial paper conduit technology are currently setting up the structures, or have expressed interest to do so in 2001. Among these firms are SG Cowen, ABN Amro and Banc One. Not only will the structure comply with the liquidity requirements outlined in the new Basel Accord, but SIVs are fully hedged dynamic portfolios, offering many attractive advantages over traditional multiseller vehicles.

This wave of the future is not worry-free, however: even though SIV technology has existed for more than 10 years, market players describe the structure as largely "under wraps," "secretive" and "cutting-edge," leading investors to worry about a lack of disclosure which has become a trademark of SIV management.

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