Merrill Braces for $6B-$8B in New Writedowns
Subprime woes mean unprecedented third consecutive losing quarter for brokerage
By Jim O'Neill,  Newser User
Posted Apr 16, 2008 10:28 AM CDT
A realtor's sign is seen on the lawn of a foreclosed home in Egg Harbor Township, N.J.   (AP Photo/Mel Evans)
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(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.