talked to bbp, page-16

Balto - WA today

Talks will drag on

Babcock & Brown Power could face some lengthy negotiations as it attempts to allay the concerns of an increasingly nervous banking syndicate, an informed source told Xchange. The debt-laden B&B offshoot suspended its shares from trading last week, as it cut profit guidance ahead of a review of its banking covenants on $2.7 billion of debt.

At the time BBP said it hoped to provide "further clarity" on those discussions by the end of this week, but it is understood BBP is a long way off resolving the bankers' worries.

It could be a few more weeks before the bankers' concerns are put to rest, the source said, and the relationship with failed parent, Babcock & Brown, only complicated matters.