Wachovia says the value of its collateralized debt obligations dropped last month by an estimated 1.1 billion dollars, pretax.
The Charlotte (North Carolina) bank says that will require a writedown of about $1.11 per share for October.
Wachovia's writedowns for its exposure to mortgage-backed securities and CDOs, complex instruments that combine slices of
different kind of risk, totaled 35 cents a share for the third
Wachovia's filing with the Securities and Exchange Commission says the market in November remains "extraordinarily volatile."
The company plans to boost its allowance for loan losses in the fourth quarter because of expected credit deterioration in the housing market. The provision is pegged at 500 million dollars to 600 million dollars in excess of charge-offs in the quarter.