Barclays Capital has completed the restructuring of a $1.8bn (€1.3bn) structured investment vehicle run by UK hedge fund Cairn Capital that ran into funding problems in the face of increasingly tough conditions in the commercial paper market.

Barclays and Cairn said in a statement today they have restructured the Cairn High Grade Funding I vehicle, one of several so-called SIV-lite funds that Barclays helped arrange. SIV-lites rely on short-term commercial paper to fund portfolios of longer-dated securities.