A Singapore sovereign wealth fund is expected to be the lead investor in a $6 billion (€4.1 billion) fund that TPG, the private equity firm, is raising to invest in troubled financial firms.

Government Investment Corp (GIC) of Singapore would commit between $2 billion and $3 billion to the new financial opportunities fund, which is being marketed exclusively to a handful of the world's largest sovereign wealth and pension funds, according to sources familiar with the matter. GIC did not return calls for comment.

The State Administration for Foreign Exchange, an arm of the Chinese government with responsibility for managing the country's official $1,530 billion in foreign exchange reserves, might also come in as a big investor in coming weeks. Middle East funds and some of TPG's long-term core investors, such as Calpers and Calstrs, the big California public sector and teachers' pension funds, might also invest.

The deal is the second in as many weeks to buck the recent trend of direct investment by sovereign wealth funds, reflecting their growing concern at the potential for domestic criticism.

China Investment Corporation's expected investment of about $4 billion in a fund being raised by JC Flowers, the US group, was revealed last week.