Reuters – A U.S.-based trade group for hedge funds has urged the Bank of England to step in and speed up the freeing up of assets frozen in the collapse of Lehman Brothers Holdings Inc, saying it has become "an issue of very substantial systemic significance."

Richard Baker, a former U.S. congressman who heads the Managed Funds Association (MFA), said the lock-up of Lehman assets threatens British prime brokerage businesses and "will exacerbate systemic risks if not handled properly."

He made the plea in a letter dated Oct. 13, sent to the British central bank’s governor on the eve of a meeting between the administrators of Lehman Brothers International (Europe) (LBIE) and UK regulators.

Baker also said the current process is adding more uncertainty to global markets and that expediting the return of assets will give the market "a much needed boost of liquidity and confidence."

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