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July 24, 2008 11:28:35 PM CDT

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Merrill Braces for $6B-$8B in New Writedowns

Posted Apr 16, 08 10:28 AM CDT in Business 

(Newser) – Merrill Lynch is likely to report another $6 billion to $8 billion in writedowns related to the subprime collapse tomorrow, leading to a third consecutive quarterly loss, the Wall Street Journal reports. Merrill’s chronic mortgage losses—$30 billion and counting—show just how deep the world's largest brokerage is mired in the mess, and have it slashing costs and jobs.

Though the subprime market began to crack early in 2006, experts say Merrill continued to create subprime securities into 2007. The company still has $7.5 billion in subprime exposure, well down from its June high of $40.9 billion, and contends that a $12.8 billion round of capital funding has left it solid for the future.

Source Wall Street Journal

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A realtor's sign is seen on the lawn of a foreclosed home in Egg Harbor Township, N.J.   (AP Photo/Mel Evans)
Merrill Lynch CEO John A. Thain is seen in this May 22, 2006 file photo.   (AP Photo/Richard Drew, file)
A man checks his PDA outside the headquarters of Merrill Lynch & Co., Wednesday, Nov. 14, 2007, in New York.   (AP Photo/Jin Lee)
The corporate logo for Merrill Lynch is shown at an office, in this July 17, 2007 file photo in New York.   (AP Photo/Mark Lennihan, file)
A man leaves a Merrill Lynch office, Tuesday, July 17, 2007 in New York.   (AP Photo/Mark Lennihan)
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subprime crisis  • mortgage crisis  • Merrill Lynch  • writedowns  • John Thain  • brokerage


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