Private equity giant Carlyle Group has pledged to "stand by" investors in the firm's failed billion dollar hedge fund, the Financial Times has reported.
Carlyle Capital shares were listed in Amsterdam in July 2007
The firm's co-founder David Rubenstein told the newspaper that he was working on ways to address clients' losses.
His comments came after Carlyle Capital Corporation (CCC), a unit of Carlyle Group, said it was unable to pay back its debts and may be liquidated.
Some $600m (£295m) of clients' money will be lost if the fund fails.
The fund is the latest casualty of the widening credit market crisis.
CCC's problems emerged last week when it became apparent that the fund was not going to be able to service its debts.
Some of the banks that had lent CCC money started liquidating assets, and the fund's shares, which are listed in Amsterdam, were suspended.
On Wednesday, CCC said that it had not been able to refinance its business and it had so far defaulted on about $16.6bn (£8.1bn) of its debt.
CCC said that it would collapse if, as expected, its lenders seized the remaining assets.
Other investment funds may now face similar problems, analysts fear.
In the past year, CCC and other global banks and hedge funds have been buying mortgage-backed securities.
These were assets which offered strong returns and were seen as relatively safe investments because the US housing market had been enjoying relatively robust and uninterrupted growth.
However, their value has plummeted in recent months after higher interest rates led to a drop in the housing market and a surge in mortgage defaults, especially in the sub-prime sector which focused on clients with low incomes or poor credit.
With the sharp slowdown in the US housing market, doubts have emerged about the viability of mortgage assets even if they are not linked to sub-prime borrowers with poor credit.
And it is this which has hit Carlyle - which held Triple A mortgage securities backed by government-sponsored mortgage lenders..
Despite the problems, Carlyle's boss was upbeat about his company's future. "I don't think one fund out of 60 will spoil a reputation built up over 20 years," Mr Rubenstein told the Financial Times.
"We have stood behind out products in the past and we are working on ways to address the losses that are being suffered by investors," he said.