This is a live blog of a Bear Stearns conference call held today regarding its need for emergency funding. All times are Eastern Daylight.
12:40p Bear Stearns to release Q1 earnings earlier than scheduled, on Monday (March 17) after the closing bell.
12:40PBear Stearns says its been affected by rumors. Although cap ratios are in good shape, liquidity deteriorated due to the rumors it was having a liquidity problem.
12:41P People scared by rumors tried to get cash out. Bear tried to respond, but problem accelerated. Realized yesterday that it might not have enough money to give to those withdrawing. Wanted more time to get facts out to the marketplace.
12:42P In consultation with Lazard, decided to talk to JPMorgan to get some liquidity to buy time and get facts out into the marketplace. Will have more information when earnings released on Monday.
12:43p Bear remains comfortable with analysts' forecasts for first quarter results.
12:44P Will continue to persue "alternatives" trying to protect customers while enhacing shareholder value.
12:45P Bear wasn't having significant liquidity problems at beginning of the week. On Thursday experienced "pretty broad cash outflows."
12:48P Any acceleration in requests for cash today? Answer: Nothing materially different than earlier in the week on prime brokerage and repo.
12:50P One of the reasons we went to JPMorgan is that it is the clearing agent of our collateral, so easy for them to see the kind and quality of the collateral that we have available, and so could move quickly.
12:52P No material changes in liquidity ratios. "Untrue rumors" caused concerns among lenders and thus we lost capacity. Going with JPMorgan will allow Bear to borrow against collateral.
12:54P We will be able to convince customers and counterparties that we have the ability to fund ourselves every day and do business as usual.
12:55P Frankly, this is a bridge to a more permanent solution.
12:56P Gives us a chance to look at the alternatives, that can run the gamut, and give everyone a chance to see the facts and not the fiction. We will look at a range of alternatives.
12:57P The conference call has concluded.
Stocks Mentioned in this story:
Bear Stearns
JPMorgan