LEAD: Merrill Lynch reports $2.24 bil. net loss in July-Sept.
(EDS: ADDING MORE INFO)
Merrill Lynch & Co. said Wednesday it swung into a net loss of
$2.24 billion, or $2.82 per share, in the July-September quarter, hit by $7.9 billion in write-downs on collateralized debt obligations and subprime mortgages.
The investment bank forecast earlier this month its write-downs on such mortgages will reach about $4.5 billion.
In the July-September quarter of 2006, the New York-based bank booked net earnings of $3.05 billion.
The sharply higher-than-expected subprime write-downs indicate bad loan woes are expanding among financial institutions.
Revenue for the three-month period under review dropped 94 percent from a year earlier to $577 million.
''Mortgage and leveraged finance-related write-downs in our FICC (fixed income, currencies & commodities) business depressed our financial performance for the quarter,'' said Stan O'Neal, chairman and chief executive officer, in a statement.
''In light of difficult credit markets and additional analysis by management during our quarter-end closing process, we re-examined our remaining CDO positions with more conservative assumptions. The result is a larger write-down of these assets than initially anticipated.
''We expect market conditions for subprime mortgage-related assets to continue to be uncertain and we are working to resolve the remaining impact from our positions,'' O'Neal said.
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|Publication:||Japan Weekly Monitor|
|Article Type:||Financial report|
|Date:||Oct 27, 2007|
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