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National City Corporation Summary: According to a press release dated January 24, 2008, the complaint charges National City and certain of its officers and directors with violations of the Securities Exchange Act of 1934. National City, a financial holding company, provides commercial and retail banking, mortgage financing and servicing, consumer finance, and asset management services in the United States.
The complaint alleges that during the Class Period, defendants issued materially false and misleading statements regarding the Company’s business and financial results. As a result of defendants’ false statements, National City stock traded at artificially inflated prices during the Class Period, trading above $30 per share during much of the Class Period.
In October 2007, National City announced a big decline in earnings due to losses related to its mortgage business but assured the market about the dividend. Then, on January 2, 2008, the Company announced a 49% reduction in its quarterly dividend to $0.21 per share from $0.41 per share. On this news, National City’s stock dropped from $16.46 per share to as low as $15.45 per share, closing at $15.59 per share on January 2, 2008 on volume of over 12.7 million shares.
The true facts, which were known by defendants but concealed from the investing public during the Class Period, were as follows: (a) the subprime mortgages on the Company’s books were a much bigger risk to the Company’s financial position than represented; (b) the Company was failing to adequately reserve for mortgage-related exposure, causing its balance sheet and financial results to be artificially inflated; and (c) defendants had no reasonable basis to make favorable predictions about the Company’s future dividend payments and future financial performance given the problems in the business.
As a result of defendants’ false statements and omissions, National City’s stock traded at artificially inflated prices during the Class Period.
INDUSTRY CLASSIFICATION:
SIC Code: 6021
Sector: Financial
Industry: Regional Banks
| COMPANY/ISSUER NAME: | National City Corporation |
| COMPANY/ISSUER TICKER: | NCC |
| COMPANY WEBSITE: | http://www.nationalcity.com |
| FIRST IDENTIFIED COMPLAINT IN THE DATABASE | |||||||||||||||||
| Robert Casey, et al. v. National City Corporation, et al. | |||||||||||||||||
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| DOCUMENTS FOR THE FIRST IDENTIFIED COMPLAINT | |||
| Complaint for Violation of the Federal Securities Laws | |||
| Type: Complaint | Date on the document: 01/24/2008 | ||
| OTHER DOCUMENTS | |||
| Case Name and/or Number: | |||
| Type: | Date on the document: | ||
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