Question-and-Answer Session
Operator
Thank you. [Operator Instructions]. The first question is from Andre Hardy from RBC Capital Markets. Please go ahead.
Andre Hardy - RBC Capital Markets
Thanks. A quick one for Bob to start and then another one for Yvan, so, Bob, I understand that in the Canadian asset-backed commercial paper market, these third parties were often selling CDOs or CDS and other organizations would be buying those credit default swaps, is there counterparty risk there with BMO?
William A. Downe - President and Chief Executive Officer
Sorry, it's a counterparty risk with who?
Andre Hardy - RBC Capital Markets
With some of the conduits that may have written credit default swaps?
William A. Downe - President and Chief Executive Officer
No material counterparty risk as that I am aware of with respect to those conduits.
Andre Hardy - RBC Capital Markets
Thank you. And Yvan has very impressive trading performance in July considering everything that happened, interest rate trading revenue benefit from steeper yield curve, widening spreads and increased volatility. Would things be any different in August? Did you take some bets off the table or directionally you're still positioned that way?
Yvan J. P. Bourdeau - Chief Executive Officer and Head of Investment Banking Group
So, you are absolutely right the... as to the elements are contributed to our profitability, I mean, I think all of our interest rate trading in the third quarter particularly towards the latter end of the quarter. Looking into Q4, I think as Bill has indicated, there was definitely some headwinds that we are faced with. There is no question that there are turbulence in the financial markets, and also there is some clouds on their eyes with regard potential credit crunch that may appear in the US particularly. And this may become more evident in other region around the world. So, given all of that context, I think it's fair to say that the trading opportunities were not as conducive during that month of August as they were towards the latter part of Q3. As to whether or not this will continue in September and October is still a question mark and it's difficult to say at this point in time. We did see some improvements since the beginning of last week in terms of the market stabilizing both in the Europe as well as in North America and this trend has been gradually improving as we moved along. But as you know, the market is still nervous and there is still some reluctance on part of some institutional investor. So, I think the next couple of weeks would be very important as we move out of the summer holiday, and we see institutional investor returning full swing in the US and Canada and Europe and then take the temperature of that point in time to answer maybe more specifically to your question.
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