Independent – RAB Capital, the troubled London-based hedge fund, yesterday agreed to sell its Asian business as it tries to shore up its finances.

The fund manager, which on top of the general woes affecting the industry has made wrong calls including buying shares in now-nationalised lender Northern Rock, said it was selling the assets and business of its loss-making Northwest brand for £1m to its original owners, at a big book loss. As recently as last June, RAB valued Northwest at £20m. However, the sale will allow the fund manager to save between £3m and £4m in costs annually, and a spokesman said that after tax adjustments the writedown would be closer to £9m.

Northwest’s assets under management, held in three funds, were approximately $300m at the end of December. On a pro-forma basis, the business and assets it is selling generated pretax profit of around £9m in 2007, but analysts believe Northwest may have slipped into the red last year.

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 Independent- Citigroup is coming under pressure to bail out investors in one of its troubled hedge funds, in another embarrassment for a company already among the biggest losers from the credit crisis.

The company has begun quietly asking private clients to accept a $250m compensation package, in return for dropping legal claims against the company. Banks which have sunk an estimated $1.6bn into the fund are also examining their legal options.

The problems stem from Citigroup’s Falcon Strategies hedge fund, an investment vehicle that traded mortgage bonds, government debt and a range of credit derivatives, which began experiencing big losses when the credit markets ran into difficulties last summer. Thousands of Citigroup clients – advised to invest in the fund by brokers at its Smith Barney wealth management division – face being wiped out.

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