Don’t feel too bad losing 98% on USO, Bank of China is a lurker too.
Bank of China Ltd.’s estimate for the carnage to retail investors from the collapse in a product linked to U.S. crude oil futures has surged 11-fold to more than 7 billion yuan ($1 billion) as it consolidated reports from its nationwide network, according to people familiar with the matter.
The lender’s estimate of losses to customers across China increased from about 600 million yuan in the middle of last week as more information was gathered from its over 10,000 outlets, said the people, asking not to be identified discussing a private matter. The number isn’t final and subject to further changes as the lender examines the data from its branches, one of the people said.
The losses stem from the bank settling May West Texas Intermediate contracts that underpinned its “Crude Oil Treasure” product on April 20 at minus $37.63 a barrel, leaving Bank of China customers caught in the middle of oil’s unprecedented collapse below zero. Hundreds have taken to the Internet to protest the lender’s handling of the contract rollover and to demand it shoulder some of the losses.