Mumbai: JPMorgan Chase
and Bank of America are expected to report losses of nearly $3 billion in mortgage
securities and leveraged loans this month, the Financial Times quoted analysts
as saying. The paper
said JPMorgan is likely to report mark-to-market losses on leveraged loans of
about $1.4 billion and an additional $700 million in write-downs of mortgages
and mortgage-backed securities. Bank
of America, it said, is expected to write down $700 million in leveraged loans
and mortgage loans of $300 million. Citigroup,
the biggest US bank, had already taken a pretax write-down of $1.4 billion as
of third quarter-end. Motgage
lender Bear Stearns said it was writing down its $7.6 billion portfolio by about
$250 million, or 3.2 per cent. Morgan Stanley wrote down its $31 billion portfolio
by $726 million, or 2.3 per cent. JP
Morgan and Bank of American were anxious to make hundreds of millions of dollars
on leveraged loans and mortgage-based securities the same as their peers. Concerns
about the big financial institutions should not dissipate with the news. The write-downs
may handle current estimates of what some of these loans and financial instruments
are worth, but if the private equity environment and housing situations get worse
more write-offs could follow. Meanwhile,
Robin Osmond, head of Europen equity markets at JP Morgan has left the bank after
one year. Osmond was former head of global investment banking at HSBC. The
US bank appointed Osmond as head of European equity capital markets for corporate
clients in June last year and he departed last month, according to the Financial
Services Authority register. He is thought to be considering other job offers.
also see : General
reports on Banks & Financial Institutions Other
reports on Bank of America
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