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Royal Bank of Canada is using the coronavirus pandemic to seize a large portfolio of assets at rock-bottom prices, a New York real estate investment trust claims.

In a suit filed Wednesday in federal court in Manhattan, a subsidiary of AG Mortgage Investment Trust Inc. said it received March 23 margin calls from Canada’s largest lender. According to the complaint, RBC said the REIT’s commercial mortgage-backed securities have “drastically declined” in value due to the crisis, allowing the bank to demand additional cash or securities to meet requirements.

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But the trust says the calls are entirely subjective and don’t actually reflect the true value of the CMBS. While many other banks have agreed not to pursue remedies against mortgage real estate investment trusts, RBC has refused — and planned to hold an auction Wednesday that included US$11 million of the trust’s assets, the lawsuit says.