Today, the SEC announced two additional “Settlements in Principle” with RBC Capital Markets Corp. requiring the firms to offer to repurchase auction rate securities at par from their clients who purchased the securities from the broker-dealers prior to the collapse of the auction rate security market in February 2008. As with several earlier Settlements in Principle with other firms, the terms of the settlements vary but Bank of America agreed to buy back $4.7 billion worth of auction rate securities from its customers and to use its best efforts to provide up to $5 billion in liquidity to ARS institutional customers such as businesses, charities, and institutional investors and RBC agreed to repurchase up to $850 million worth of the securities from its customers.

These “Settlements in Principle” are part of a line of actions by the Commission, the New York Attorney General's Office, the North American Securities Administrators Association, and FINRA The SEC previously reached similar settlements in principle with Citigroup, UBS, Wachovia and Merrill Lynch. In connection with these settlements, the staffs of the Divisions of Corporation Finance, Trading and Markets and Investment Management issued a global exemptive order providing no action and exemptive relief for various thorny issues such as beneficial ownership reporting and the tender offer rules for firms complying with the settlements.