built-in watchdog does not reset 8260

The board hangs up instead. The watchdog itself works for sure, I checked it
out with a ‘lazy’ IPL. With a speedy IPL, procnto-600 starts, in ~2 secs
the watchdog comes along and hangs up the board.

Interestingly enough that other board (860 one) resets w/o hanging. I
guess 8260’s problem has something to do with System Reset Exception
handling. Any idea what procnto-600 might do differently then procnto-800?
Settings on 8260 are SYPCR=0xFFFF06C7, MSR=0x9932.

Thanks,
Dmitri