Stifel Financial Corp (SF.N) on Monday said second-quarter profit fell 84 percent as the investment bank and brokerage absorbed charges related to a lawsuit and a regulatory probe as well as costs stemming from its Thomas Weisel Partners takeover last year. Positive results across most of Stifel were wiped out by an ongoing lawsuit related to its sales of collateralized debt obligations to five Wisconsin school districts. Stifel on Monday said it purchased notes with a face value of $162.5 million at a significant but undisclosed discount. The charges also reflect estimated future litigation costs and a related regulatory investigation into these sales, which generated substantial losses for the schools. Stifel is suing Royal Bank of Canada (RY.TO), which underwrote the securities. The Securities and Exchange Commission is investigating Stifel to determine whether the CDO deals were suitable for the school districts.
Stifel Financial Corp is a financial holding company. Shares of SF fell by 9.93% or $-3.25/share to $29.48. In the past year, the shares have traded as low as $28.72 and as high as $49.94. On average, 633820 shares of SF exchange hands on a given day and today's volume is recorded at 1448103.
Royal Bank of Canada (RBC) is a diversified financial services company. Shares of RY fell by 4.64% or $-2.37/share to $48.69. In the past year, the shares have traded as low as $46.04 and as high as $63.59. On average, 715740 shares of RY exchange hands on a given day and today's volume is recorded at 1893178.
