BOSTON - FleetBoston Financial Corp. (NYSE:FBF) announced a fourth-quarter loss of $507 million on Tuesday, blaming the meltdown of Argentina's economy late last year for the loss. The company, in the fourth quarter of fiscal year 2000, turned in a profit of $894 million.
The financial services company, which during 2001 took a leading role in the development of ATMs with audio capabilities, wrote off about $1.19 billion in the fourth quarter in valuation adjustments, loan reserve strengthening and after-tax charges relating to the ongoing financial problems in Argentina.
"A weakening global economy and the turmoil in Argentina resulted in further pressure on our loan portfolio and we took action in this area by aggressively addressing our problem loans and boosting loan loss reserves," Fleet president and chief executive officer Chad Gifford said in the company's fourth quarter report.
Fleet officials said the company, which has had a presence in Argentina for 85 years, will continue working with the new Argentine government. The government has abandoned the country's fixed dollar-to-peso exchange rate and converted certain dollar-denominated loans and deposits into pesos to strengthen the economy.
"The Corporation is working with the new Argentine government in its efforts to stabilize the economy and we will continue to monitor the situation very closely," Fleet's year-end report states. "FleetBoston has … managed through numerous political and economic crises in the past."
The $1.5 billion negative turnaround in the company's fourth-quarter figures from 2000 to 2001 also had a major impact on the company's year-end numbers. While Fleet still registered a profit in fiscal year 2001, it was $931 million as compared to a $3.9 billion profit in fiscal year 2000.
