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Both SIVs are managed by Brightwater Capital Management, an asset management unit of the German bank.

The bumper credit lines offered by WestLB mean the SIVs will not be forced to sell off their assets on the cheap if they hit problems raising short-term capital.

It means they will be able to roll over or pay off their commercial paper obligations as they come due.

A spokesman declined to detail the size of the credit line. He said: "WestLB has extended a credit facility to each of the vehicles, which effectively functions as a liquidity back-up line to fund the redemption at maturity of all outstanding commercial paper and medium-term notes."

WestLB has a total exposure of about $25 billion to short-term capital-raising programmes such as SIVs and conduits.

WestLB has already admitted that it is heading for a full-year pre-tax loss in the "the low three-figure million range" because of the turmoil that has raged in the capital markets this year.

The bank also fell into the red for the first half thanks to a €604 million loss using the bank's own money to place bets in the equities markets.

The continued capital issues for SIVs underscore the problems that still grip the asset-backed commercial paper (CP) markets, which have effectively been closed since mid-August.

SIVs such as Kestrel and Harrier raise capital to invest in other assets by selling CP to investors.

The market has traditionally provided an easy way for SIVs and other vehicles to raise short-term capital over periods of between 30 and 90 days.

However, banks have refused to extend loans to these SIVs because of their exposure to sub-prime mortgages or related securities and structured credits.

In recent weeks, HSBC has dealt with its SIV funding problem by agreeing to take $35 billion of its $45 billion exposure on to its balance sheet.

If the SIVs struggle to raise capital between now and August 2008, HSBC will stand behind their obligations.

Barclays has already ploughed capital, at commercial rates of return, into bailouts of several SIVs it arranged, including a $1.5 billion vehicle managed by Cairn Capital, the hedge fund.

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