One Chatty Banker Cost His Bank 'Millions Of Dollars' On The Alibaba IPO Deal

Last month, the Royal Bank of Canada had to withdraw from its role as one of Alibaba's underwriters because a wealth management executive, John Taft, said too much during the IPO's quiet period, according to a WSJ report.

His talkativeness cost the bank "millions of dollars in advisory fees from the e-commerce giant's $25 billion listing in New York," according to the report.

What's particularly unfortunate about this whole situation is that Taft wasn't even involved with the IPO deal.

Ouch.

Originally, RBC was one of the 35 banks on the Alibaba deal.

And then Taft, the head of RBC's US wealth management division, talked about the then-upcoming Alibaba deal during a conference call with The Institute for the Fiduciary Standard.

During the phone call, he used the Alibaba deal as an example "in a discussion about proposals for a fiduciary standard for broker dealers," according to the WSJ.

So RBC decided to voluntarily withdraw from the IPO.

For anyone unfamiliar with IPO proceedings, during an IPO's quiet period, those affiliated with the deal are legally not allowed to talk about or promote the stock.

Alibaba was the largest IPO ever and gained 38% on its first day of trading. On Tuesday, the company's shares broke $100.