Four of Canada's largest banks have agreed to support the restructuring of $35-billion-worth of asset-backed commercial paper, working with the Pan-Canadian Investors Committee on the plan.

The Bank of Montreal, Canadian Imperial Bank of Commerce, Royal Bank of Canada and Bank of Nova Scotia said they will join National Bank as lenders in a $14-billion margin call funding facility which will serve as a backup line of credit for the bonds that will replace the frozen non-bank ABCP. The investment vehicles were a key factor in the massive credit crunch which struck the North American markets in August.

"The support of the major Canadian banks is an important component of the plan, and we are pleased to confirm their participation, which further reflects the spirit of compromise and goodwill that has prevailed throughout this process," said Investors Committee chairman Purdy Crawford in a statement.

The plan, which was put forward in late December, would allow ABCP note holders to get their principal back eventually if they hold the new restructured notes to maturity, although the process would take longer than anticipated when investors bought the ABCP.

The committee's members and dealer bank asset providers have agreed to an extension of a standstill agreement on the frozen commercial paper, to Feb. 22 from its previous deadline of Feb. 1. The agreement was also expanded to include Devonshire Trust, which was not part of the original restructuring plan.

The Crawford Committee also announced that New York-based BlackRock Inc. would be overseeing the restructuring vehicles.