Merrill Lynch will announce $15 billion in losses stemming from mortgage investments, figure twice its earlier forecast, the New York Times reports. The firm is expected to raise $4 billion quickly from outside investors. New CEO John Thain, who has already sold a $5.6 billion stake to a Singapore state company, is considering selling off its $4 billion holdings in Bloomberg.
In fighting off a damaged reputation and ebbing capital, the largest US brokerage firm is looking to wealthy foreign governments, just as many other struggling firms have recently. A major Merrill deal with a so-called sovereign wealth fund could spur congressional scrutiny; Charles Schumer expressed concern over “non-economic interests” gaining too much control of American companies.