Secondary Market/Investors
RBC: Fun and Games with CDO Losses
By
PAUL JACKSON
November 13, 2007 7:50 AM CST
Looking at a press release put out this morning by Royal Bank of Canada, you’d think the news was the bank’s $325 million pretax gain on Visa’s recent IPO.
You’d be wrong, because the lead is buried at the bottom of the press statement:
RBC also expects to record a charge in its Capital Markets segment in the fourth quarter associated with the valuation of subprime collateralized debt obligations (CDOs) and subprime residential mortgage-backed securities (RMBS) of approximately $360 million pre-tax ($160 million after-tax and reflecting compensation adjustments).
Surprise!
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