RBC: We'll cover Ferris money-market losses
This out yesterday from the Royal Bank of Canada, which recently bought Baltimore investment firm Ferris Baker Watts. RBC will cover money-market losses for Ferris clients of up to 3 cents per share in the Primary Fund, which recently recorded a loss in net asset value -- a highly unusual outcome for a money market fund. Primary Fund, which was the main MM fund for Ferris clients, went from $1 per share to 97 cents. RBC says it is putting aside $35 million to cover Ferris client losses "up to 3 cents per share should clients receive less than $1.00 per share when the fund is liquidated."
RBC TO SUPPORT CLIENTS IMPACTED BY RESERVE FUND ISSUE NEW YORK, September 25, 2008 — Royal Bank of Canada (RY on TSX and NYSE) today announced that it has committed up to $35 million to protect clients who have invested in the Reserve Management Co. Primary Fund, a U.S. money market mutual fund managed by a third-party provider.The Primary Fund recorded a net asset value (NAV) below $1.00 per share, by
recently reporting a NAV for The Primary Fund of $0.97 per share. Since then, assets
held by individual investors in the fund have been inaccessible.RBC’s US Wealth Management unit, on behalf of its independent subsidiary,
Ferris, Baker Watts (FBW), last week initiated a redemption request for FBW client
assets invested in The Primary Fund and is taking this additional action to mitigate client
losses up to 3 cents per share should clients receive less than $1.00 per share when
the fund is liquidated.Money market funds managed by RBC are not impacted by this issue. RBC is
confident in its ability to maintain the NAV of its money market funds.
“We are taking this step, in partnership with the Investment Executives at FB W,
to provide additional protection for the assets of FBW clients,” said John Taft, head of
US Wealth Management. “This is an example of RBC’s willingness to use its global
resources to address the needs and concerns of our wealth management clients during
this period of extraordinary market volatility.”
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For more information, please contact:
John Bousquet, RBC Wealth Management, (612) 371-2225
Comments
Is Gil Kuta and FBW able to
manage more than the money generated from a child's lemonade stand without screwing up? This summer they were bouncing checks , now they get caught with all their eggs in one basket and it the investors fault !!!! I only have a high school education but but something does not smell right with this bunch!!
Posted by: Ben Ripedoff | September 26, 2008 7:13 PM