Goldman Sachs is raising money to launch a new hedge fund to exploit distressed-debt bargains, according to Reuters.The bank has raised more than $1.5 billion in the past few weeks for Goldman Sachs Liquidity Partners, sources said. Its reported goal was $1 billion.

The fund will invest in a broad range of distressed assets, including mortgages and buyout loans. Goldman’s efforts come at a time when a number of hedge funds are asking for capital for new distressed debt funds.

Goldman’s rival Lehman Brothers is preparing a $2 billion fund, a person familiar with the situation stated.

More than a dozen distressed funds have raised $23 billion through last month, topping the $18 billion raised for such funds last year, according to research firm Private Equity Intelligence.

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