GE Says Investors Cashed Out From Fund

GE Asset Management Trust's Enhanced Cash Fund, a short-term bond fund, returned money to investors at 96 cents on the dollar, spokesman Chris Linehan said.

The short-term bond fund now holds $5 billion following the withdrawals of about 10 non-GE investors, he said. The withdrawals are "not significant to the viability of the fund," Linehan said.

The remaining assets are part of a $60 billion GE U.S. pension fund for 530,000 active employees, vested former employees and retirees and their beneficiaries.

Linehan said the losses were from mortgage-backed securities, including those linked to subprime home loans. GE has not disclosed how much the fund has invested in mortgage-backed securities.

The net asset value began declining in the summer. Investors were aware that the fund would "not necessarily always maintain" a $1 net asset value, Linehan said.

The losses in the bond fund raised concerns among investors that the impact on credit markets could spread and hurt small investors.

GE shares fell 70 cents, or 1.8 percent, to close at $38.31 Thursday.

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