Losses from credit crunch seen approaching $1 trillion

Apr.09, 2008 in Market Outlook

Credit losses pegged at nearly $1 trillion

By MarketWatch

Last Update: 1:01 PM ET Apr 9, 2008

BOSTON (MarketWatch) — Welcome to our daily roundup of subprime and
credit-crunch-related news from MarketWatch.

Each weekday morning, Subprime Today provides a synopsis of our own coverage as
well as stories from other news outlets, providing links to those original
articles. Sign up for daily alerts to receive this report via email.
Click for Detail

MarketWatch also maintains an up-to-date list of jobs lost this year in the
housing- and mortgage-related sectors and industries. See layoffs page.
Click for Detail

IMF: Credit crunch losses could approach $1 trillion

WASHINGTON (MarketWatch) — The total potential global losses from the credit
crunch could top $945 billion over the next two years, the International Monetary
Fund estimated, suggesting more pain for the financial sector and more headaches
for governments struggling to contain the crisis. See full story.
Click for Detail

U.S. to expand program to help homeowners

WASHINGTON (MarketWatch) — In an effort to let more struggling borrowers keep
their homes and prevent defaults on unaffordable home loans, the Bush
administration is expanding a federal program to allow more homeowners to
refinance mortgages. See complete article.
Click for Detail

Fed looks at options for weathering credit crunch: report

NEW YORK (MarketWatch) — The Federal Reserve is exploring backup options to
extend its lending power in case the recent plans it has implemented to loosen
the credit markets are unsuccessful, The Wall Street Journal reported on
Wednesday. Read more.
Click for Detail

Mortgage applications rise

CHICAGO (MarketWatch) — Mortgage application filings rose a seasonally adjusted
5.4% last week compared with the last week of March, the Mortgage Bankers
Association reported on Wednesday. See expanded coverage.
Click for Detail

Citigroup close to selling $12 bln of troubled debt

BOSTON (MarketWatch) — Citigroup Inc. is nearing a deal to sell some $12 billion
in troubled debt to private equity firms for an average price of slightly less
than 90 cents on the dollar, according to multiple reports. See full story.
Click for Detail

WaMu rejected J.P. Morgan acquisition bid: report

BOSTON (MarketWatch) — Washington Mutual Inc. (WM) turned down a takeover offer
from J.P. Morgan Chase & Co. (JPM) before it reached a deal this week to get a $7
billion capital infusion from an investor group led by private equity firm TPG,
The Wall Street Journal reported Wednesday. J.P. Morgan’s offer was in stock with
a preliminary bid of as much as $8 a share, the newspaper said. Some executives
at J.P. Morgan were angered by WaMu’s decision not to accept the bid, while WaMu
said the bid was unclear and was worth significantly less than $8 a share,
according to the report. J.P. Morgan, which acquired collapsed Bear Stearns Cos.
(BSC), is pursuing more acquisitions and is thought to desire SunTrust Banks Inc.
(STI) for its Southeast operations, The Journal reported. See full story.
Click for Detail

Subprime crunch triggers lawsuits: study

The ongoing housing slump and subprime mortgage crisis have sent more unhappy
shareholders to federal court, the Associated Press reported. See full story.
Click for Detail

Level 3 assets for Goldman Sachs, Morgan Stanley climb

LONDON (MarketWatch) — Goldman Sachs (GS) and Morgan Stanley (MS) both disclosed
in 10-K filings that Level 3 assets, or hard-to-value corporate loans,
residential and commercial mortgage-related securities and other instruments,
rose from the last quarter. Goldman Sachs said Level 3 assets rose to $82.3
billion, or 13% of total assets at fair value, at the end of February from $54.7
billion, or 10% of total assets at fair value, at the end of November. Morgan
Stanley said Level 3 assets rose to $78.2 billion at the end of February from
$73.7 billion at the end of November, in both cases representing about 15% of
total assets measured at fair value.

Deutsche Bank CEO wants more oversight of ratings firms: report

Deutsche Bank (DB) Chief Executive Officer Josef Ackermann said ratings firms and
accounting practices should be reviewed and regulatory oversight improved to help
avoid a repeat of the current financial crisis, Bloomberg reported. See full
story at Bloomberg.com.
Click for Detail

Soros estimates subprime losses

George Soros, the hedge fund legend and billionaire philanthropist, said on
Wednesday the subprime mortgage crisis is likely to cause global losses of over
$1 trillion, characterizing the situation as the most severe since the Great
Depression, Reuters reported. See full article.
Click for Detail

Did you like this? If so, please bookmark it,