Fund firms including BlackRock are asking the SEC to review rules that limit them from purchasing the sort of securities that are at the center of the government's Term Asset-Backed Securities Loan Facility, the New York Post reports.

"We are trying to address this issue proactively," Curtis Arledge, co-head of BlackRock's US fixed-income group, was quoted as saying.

BlackRock has had one discussion with the SEC regarding the matter.

Fund firms face restrictions on how much leverage they can take on. The Term Asset-Backed Securities Loan Facility, however, involves leverage ratios of as much as 20-to-1, the report notes.

But fund companies say the leverage provided through TALF carries no risk to the borrower since it's done via non-recourse loans. Such loans, fund firms say, should not be deemed a type of leverage.  

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