Friday 11th July 2008
|Text too small?|
The bank established a provision of A$181 million on March 31 after disclosing an exposure to US$1.1 billion of CDOs via the provision of liquidity lines to conduit financing vehicles. CDOs are securities backed by a pool of bonds, loans and other assets.
Since March, "the economic environment has deteriorated further," NAB said in a statement. "There continues to be a risk that further provisioning may be required."
The global credit crunch left banks with losses from CDOs as credit ratings were slashed and sapped demand for the securities. The volume of CDOs sold in the first half of the year amounts to just 10% of sales in the same period of 2007, the Financial Times reported, citing data from Dealogic and Total Securitization.
NAB said the CDOs it is exposed to are currently meeting their principal and interest obligations.
Shares of NAB have declined about 22% on the ASX this year and were recently at A$27.28.
No comments yet
Scott Technology Limited (NZX: SCT) Announces FY21 Results
21st October 2021 Morning Report
Greenfern Industries Limited (NZX: GFI) L&Q Notice
TruScreen Group Limited (NZX: TRU) Clinical Trial Results Highlight Efficacy of TRU Technology
20th October 2021 Morning Report
Freightways Limited (NZX: FRE) Acquisition of ProducePronto
19th October 2021 Morning Report
PGG Wrightson Limited (NZX: PGW) Guidance Update
Vital Limited (NZX: VTL) Provides Update on PSN LMR
18th October 2021 Morning Report