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Posts: 173430
01/03/08 1:02 PM
Adminstrator Co-Founder Owner/Emeritus
Quote:Merrill Lynch (nyse: MER - news - people ), also on the ropes because of mortgage derivatives, said last week that it would get $6.2 billion in capital by selling a stake to the Singapore investment fund Temasek, and it would sell its middle market lending operations to GE Capital. Layoffs are expected imminently. Merrill and other commercial banks begin reporting fourth-quarter and year-end results later this month. Analysts are bracing for a rough ride. Merrill is expected to write down another $11.5 billion in losses. Citigroup is expected to write off anywhere from $12 billion to $18.7 billion, and JPMorgan Chase (nyse: JPM - news - people ) between $1 billion and $3.4 billion. "It will be a couple of quarters before the current credit crisis is fully digested by the markets," says Goldman Sachs analyst William Tanona. National City is seen reporting a per-share loss of 8 cents for the quarter, according to Goldman research. Wachovia (nyse: WB - news - people ) is expected to report quarterly profits down 84% from the last quarter of 2006, while Bank of America (nyse: BAC - news - people ) will likely see numbers come in 88% lower, Goldman says. Two other big lenders, Comerica (nyse: CMA - news - people ) and Fifth Third, are seen having profit declines of 43% and 59%, respectively.