subprime mortgages

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Feds Eye UBS as Subprime Probe Widens

Criminal prosecutors target Swiss banking giant for mispricing

(Newser) - US criminal prosecutors investigating the subprime mortgage mess want to find out if UBS deliberately misled investors, the Wall Street Journal reports. The Swiss banking giant may have put mortgage bonds on its books at high prices despite knowing their valuations had plummeted. There are multiple probes into the mortgage...

Negative Equity Adds Another Crippling Factor

Forbes examines pitfalls of having a loan worth more than home

(Newser) - Foreclosure is scary enough, especially at its current pace—79% more US homes foreclosed in 2007 than the year before. But, Forbes writes, the housing crisis is dumping an even scarier problem on mortgage holders around the country: negative equity, in which a mortgage is worth more than the house...

Subprime Woes Cost UBS Record $4B Loss

The Swiss bank adds to its write downs; more bad news could be coming

(Newser) - Hit hard by the subprime mortgage crisis, UBS AG announced it will write down an additional $4 billion in bad investments and post a $4.03 billion loss for 2007, a record for the company and significantly more than the Swiss banking giant predicted in December, reports the Wall Street ...

Foreign Buying Spree Reaches Deep Into US

With weak dollar driving acqusitions, lawmakers get skittish

(Newser) - As the dollar drops, foreign investors are buying up US enterprises large and small, from multi-billion-dollar stakes in Wall Street banks to ownership of chemical factories and construction companies in the likes of North Carolina. Canadian, British and German companies have been expanding their portfolios in the US for years,...

Another Head Rolls at Merrill Lynch
Another Head Rolls at
Merrill Lynch
Jan 28, 2008 3:55 PM CST

Another Head Rolls at Merrill Lynch

Co-president will step down in wake of huge subprime losses

(Newser) - Merrill Lynch co-president Ahmass Fakahany will step down after subprime mortgages led to a $9.8 billion fourth-quarter loss, the firm said today. Fakahany is at least the third exec from Stan O'Neal's team to leave since John Thain took over as CEO, reports Bloomberg. Thain replaced O'Neal in October...

Housing Crisis Hard on Pets, Too
Housing Crisis Hard on Pets, Too
Jan 22, 2008 8:27 PM CST

Housing Crisis Hard on Pets, Too

More left behind, dropped in shelters, after collapse

(Newser) - America's pets are feeling the subprime fallout these days as more homeowners are foreclosing and abandoning them, the Chicago Tribune reports. A recent spate of deserted animals—including 24 horses on an Oklahoma farm, and 21 Great Danes left to die in Pennsylvania—inspired the national Humane Society to issue...

Bush Vows Quick Boost for Economy
Bush Vows Quick Boost
for Economy
Jan 22, 2008 6:47 PM CST

Bush Vows Quick Boost for Economy

Gives bipartisan lawmakers 3 weeks to forge accord

(Newser) - President Bush pushed his fiscal stimulus plan with lawmakers today and vowed the bipartisan group will find "common ground," the Washington Post reports. The economic boost—which he set at $150 billion—will not kick in overnight, he warned, but said congressional leaders must reach an accord in...

Northern Rock Bailout Plan a Money Shuffle

Deal pays back government loans, but public still on the hook

(Newser) - The British government today unveiled its last-gasp plan to hand off the Northern Rock hot potato and prevent nationalization, the London Times reports. Under the plan, the bank would immediately pay back the £25 billion it owes the government by selling the debt to private investors as bonds. But...

Hawks Circling Subprime Carnage
Hawks Circling Subprime Carnage
Jan 17, 2008 12:33 PM CST

Hawks Circling Subprime Carnage

JP Morgan's Dimon among the survivors looking to clean up

(Newser) - After largely dodging the subprime bullet that tore through most of Wall Street’s big banks, JP Morgan Chase is looking to make a move, the Wall Street Journal reports. Buoyed by three years of cost cutting and refocusing its business, Morgan has nearly doubled its mortgage market, is flush...

Bernanke Backs Quick Bailout
Bernanke Backs Quick Bailout
Jan 17, 2008 10:50 AM CST

Bernanke Backs Quick Bailout

Fast, temporary stimulus would buoy flagging economy, Fed chief tells Congress

(Newser) - The country needs a federal stimulus package ASAP, Federal Reserve Chairman Ben Bernanke told the House Budget Committee today, advocating immediate legislation designed “so its effects on aggregate spending are felt as much as possible within the next 12 months.” But he said the package should be “...

Merrill: $9.8B Loss on $11.5B Writedown

Brokerage's first-ever full-year loss blamed on subprime woes

(Newser) - Merrill Lynch reported a fourth-quarter loss of  $9.8 billion, or $12.01 a share, nearly triple the per-share loss most analysts predicted, reports Bloomberg. It was the second straight losing quarter for the nation’s largest broker, and capped the company’s first full-year loss since 1989. Merrill said...

For Hurting US Companies, World Supplies Band-Aid

In economic sea change, 'we need the money,' one US Rep. says

(Newser) - The subprime collapse has US financial institutions in uncharted waters—asking for help from foreign investors and governments, the Wall Street Journal reports. Citigroup, Merrill Lynch, and Morgan Stanley all have recently sought bailouts, a dramatic switch from a tradition that saw US banks coming to the “rescue of...

JP Morgan Profit Drops 34% in Q4
JP Morgan Profit Drops 34% in Q4
Jan 16, 2008 7:03 AM CST

JP Morgan Profit Drops 34% in Q4

$1.3B in subprime writedowns hit earnings at third-largest bank

(Newser) - Subprime mortgage writedowns of $1.3 billion cut deeply into better-than-expected revenue gains at JP Morgan Chase in the fourth quarter, leaving the nation’s third-largest bank with net income of $2.97 billion, or 86 cents per share, a 34% drop from a year ago, reports Bloomberg. The writedown...

Merrill Hauls in $6.6B Lifeline
Merrill Hauls in $6.6B Lifeline
Jan 15, 2008 6:05 AM CST

Merrill Hauls in $6.6B Lifeline

Recapitalization plans move forward as firm struggles to shake subprime debacle

(Newser) - Merrill Lynch has reached into the deep pockets of foreign investors once again, pulling in a $6.6-billion lifeline today from a consortium of investors that include Japan’s Mizuho Financial Group and the Kuwait Investment Authority, the Wall Street Journal reports. In December, Merrill received a $5-billion cash infusion...

Citi Takes $9.83B Loss, $18B in Writedowns

Record Q4 loss offset by $14.5B cash infusion from Singapore, Kuwait

(Newser) - Citigroup announced $18 billion in writedowns and a $9.83-billion fourth-quarter loss today as a relentless torrent of mortgage defaults has brought the banking giant to its knees. The $1.99-per-share loss is the largest in Citi’s 196-year history, Bloomberg reports. Citi, struggling to recapitalize, also reported US and...

China May Scuttle $2B Citigroup Bailout

Sources say China's government is standing in the way of the deal

(Newser) - On the eve of Citigroup’s fourth-quarter earnings announcement, the Chinese government appears to have raised objections to China Development Bank's purchase of a $2 billion stake in the struggling financial giant, reports the Wall Street Journal. The proposed deal, reported by the Journal over the weekend, is part of...

Investigators Ask: Did Banks Withhold Info?

Banks hid risk of bundled 'exception' loans, insiders say

(Newser) - Prosecutors are probing Wall Street banks to see if they ever revealed the risky nature of certain subprime mortgage investments, the New York Times reports. Industry experts are accusing the banks of turning high-risk loans, called exceptions, into investments without divulging details to investors and credit-rating agencies. One probe, led...

BofA May Buy Ailing Countrywide
BofA May
Buy Ailing Countrywide
Jan 10, 2008 3:21 PM CST

BofA May Buy Ailing Countrywide

Talks between bank and troubled mortgage giant well advanced

(Newser) - Bank of America is in advanced talks to buy troubled Countrywide, the Wall Street Journal reports. The Charlotte-based bank could be on the brink of acquiring the US' largest mortgage lender, whose market value has plummeted to $3 billion—about 2 months' profit for BofA—as foreclosures continue to dent...

Citi, Merrill Look Overseas for More Cash

Big Banks could announce $25 billion in additional losses next week

(Newser) - Merrill Lynch and Citigroup, which have already tapped foreign investors for billions of dollars to help bail them out of the subprime debacle, are headed back to the well, reports the Wall Street Journal. Merrill is seeking some $4 billion more, Citi up to $10 billion—all expected to come...

More Trouble Has Countrywide Teetering

Mortgage lender sees stock dive again as foreclosures rise

(Newser) - After its stock plunged yesterday on rumors it might declare bankruptcy, mortgage giant Countrywide Financial was its shares fall to a 12-year low today on news that foreclosures and late payments were up last month, Bloomberg reports. The subprime collapse has forced the company to lay off thousands, and it's...

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