Wachovia Corporation announced today that it has reached an agreement in principle for a global settlement with the Missouri Secretary of State (as the lead State in the North American Securities Administrators Association task force investigating the marketing and sale of auction rate securities, or ARS), the Attorney General for the State of New York and the Securities and Exchange Commission regarding ARS. Wachovia is pleased that the settlement produces a liquidity solution for its clients who purchased ARS at Wachovia.
"We understand that unprecedented market conditions have created difficulties for our clients, particularly those holding auction rate securities," said Robert K. Steel, president and chief executive officer of Wachovia Corporation. "We are pleased to announce a comprehensive solution for the liquidity needs of clients who purchased auction rate securities at Wachovia and to resolve this matter with federal and state regulators."
Daniel J. Ludeman, president and chief executive officer of Wachovia Securities, LLC, said, "Since this issue arose in February when auctions first started to fail, we have played a leading role in encouraging ARS issuers to restore liquidity to all of our clients, including those who have become part of our firm through the Oct. 1, 2007, merger of A.G. Edwards and Wachovia Securities. The dollar value of ARS held by Wachovia Securities clients has been cut by more than 50 percent through redemptions and successful auctions. Today's agreement in principle underscores our desire to ensure that clients who purchased ARS at Wachovia receive the liquidity they need."
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