Peregrine Investments Holdings was last night on the verge of liquidation after desperate efforts over the weekend failed to pull Asia's biggest independent investment bank back from the brink of collapse. Procedures for the liquidation are likely to start this afternoon, according to a senior member of staff. The bank's fate was being discussed last night among Peregrine's biggest creditors, who include the Hongkong and Shanghai Banking Corporation, First National Bank of Chicago, Deutsche Bank, Citibank and Societe Generale. First Chicago is understood to be the biggest creditor and its decision not to proceed last week with the purchase of a 2.4 per cent stake in Peregrine was an ominous signal to other creditors. Two banks negotiating to buy parts of Peregrine left the table late last night without agreement, dashing hopes that a resolution would be achieved. 'We have spent the weekend shuffling the seats on the Titanic,' the staff member said. 'A miracle might occur but it looks remote.' The failure of these last-ditch efforts will deal a blow this morning to stock market confidence, already reeling from Friday's slide on Wall Street and news of higher local interest rates. Peregrine, which over the past decade built a reputation as an aggressive, risk-taking bank, lists Cheung Kong chairman Li Ka-shing, Citic Pacific chairman Larry Yung Chi-kin and the international fund management group Templeton among its biggest shareholders. The Securities and Futures Commission (SFC), after taking action on Friday to protect Peregrine's clients and investors, intensified inquiries over the weekend about the firm's conduct. 'They [the SFC] are crawling all over the place,' another source said. 'The SFC's inquiries are ongoing. They have only just started their work inside the place.' The watchdog is understood to be particularly interested in the arrangement of an unsecured loan of US$260 million (HK$2 billion) to an Indonesian taxi company, Steady Safe. Peregrine was holed below the waterline last week when the Indonesian rupiah spun out of control, leaving no chance for repayment. Zurich Insurance last Thursday night walked away from a deal to take a 24 per cent stake in Peregrine when the rupiah at one stage plunged to more than 11,000 against the US dollar in New York trading. It is understood that the giant European institution was offering only 15 US cents on the dollar for Peregrine's bond portfolio estimated to total between US$500 million and US$600 million. Peregrine's fixed income department, responsible for organising the Indonesian loan, was yesterday described as 'radioactive' and the main obstacle to a rescue. Frantic efforts were being made during the weekend to ascertain the firm's exposure through the fixed interest arm. News of the crisis at the firm has caused local and international banks to pull their lines of credit. 'Hundreds of millions of [US] dollars are falling due,' a source said. A banking analyst at a US house said: 'Once one creditor pulls out, it becomes a question of what liquid assets does the bank have to pay out. Most of Peregrine's assets appear to be illiquid at the moment. 'The assets Peregrine has are impossible to value because there are no buyers. No one wants to buy Southeast Asian securities now. Whatever property the company owns may have already been pledged.' This evaporation of confidence has compounded the problem of finding an alternative white knight. 'It's a moving target,' a senior staff member said. 'We can't figure out what anything is worth because things are moving so quickly.' A liquidation of Peregrine would jeopardise the jobs of 700 staff in Hong Kong who are only three weeks away from receiving their annual bonus. Another 1,000 employees overseas also face redundancy. The company's brokerage last night issued a statement assuring clients that all funds held on their behalf had been segregated and that all obligations would be met. Peregrine Brokerage said clients wishing to liquidate an account need not go to its office. Cheques for cash balances would be issued within 24 hours and holders of shares were advised to transfer stock to another broker for execution.