By Leah Schnurr

TORONTO (Reuters) - Royal Bank of Canada (RY.TO: Quote, Profile, Research) said on Wednesday it will see pretax writedowns of about C$855 million ($855 million) in the second quarter, its largest charge since the credit crisis began last summer.

The bank, Canada's biggest, said that after taxes and compensation adjustments, the charge to earnings is about C$420 million. It will report its results on May 29.

Royal said a "significant portion" of the writedowns reflect liquidity pressures on assets that it continues to hold, rather than underlying credit quality.

"We are not happy about taking any writedowns and certainly do not take them lightly," Gordon Nixon, Royal's chief executive, said in a statement. "That said, these writedowns are manageable and our risk profile continues to remain within our risk appetite."

The writedowns are widely distributed across a variety of corporate and capital market portfolios, Blackmont Capital analyst Brad Smith wrote in a research note.

Smith told Reuters the writedowns were "no big surprise."

"There's still lots of scope for both Royal and other domestic banks to be recording future valuation adjustments as well," he said.

Five of Canada's six major banks have been forced to take writedowns amid troubles in financial and credit markets. Royal took a pretax charge of C$430 million in the first quarter on U.S. subprime mortgage-related assets, among other items.