Write-Downs: $107.8 Billion And Counting
Well, it’s official. According to the Wall Street Journal this morning, write-downs related to the U.S. subprime mortgage meltdown now surpass $100 billion. From the Journal’s MarketBeat Blog, here is the damage to-date:
Merrill Lynch- $22.4B
Citigroup- $19.9B
UBS- $14.4B
Morgan Stanley- $9.4B
HSBC- $7.5B
Credit Agricole- $3.6B
Deutsche Bank- $3.2
Bank of America- $3.0B
CIBC- $3.0B*
Wachovia- $2.7B*
AIG- $2.7B
Barclays- $2.7B
RBS- $2.5B
Credit Suisse- $1.9B
Bear Stearns- $1.9B
J.P. Morgan Chase- $1.4B
Countrywide- $1.0B
Others- $4.6B
Total- $107.8 billion in write-downs by banks, brokerage firms, and others*Includes 4th quarter forecasts
A significant portion of the write-downs comes from 5 companies- Merrill Lynch, Citigroup, UBS, Morgan Stanley, and HSBC. Combined, they have written-down almost $73 billion in assets. Meanwhile, the Journal noted:
The thing is, the writedowns aren’t finished. Several firms retain significant exposure to subprime, such as Citigroup, which still has $37 billion in subprime exposure. Back in November, Goldman Sachs economist Jan Hatzius estimated about $200 billion in mortgage-related losses on the big banking balance sheets. (He was ridiculed for this and charged with “talking his book;” but the figures show his gloomy forecast is on the way to being fulfilled.)
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