Banks' Subprime Losses Top $500 Billion on Writedowns (Update1)

Banks' Subprime Losses Top $500 Billion on Writedowns

By Yalman Onaran
Aug. 13 (Bloomberg) -- Banks' losses from the U.S. subprime
crisis and the ensuing credit crunch crossed the $500 billion
mark as writedowns spread to more asset types.
The writedowns and credit losses at more than 100 of the
world's biggest banks and securities firms rose after UBS AG
reported second-quarter earnings today, which included $6
billion of charges on subprime-related assets.
The International Monetary Fund in an April report
estimated banks' losses at $510 billion, about half its forecast
of $1 trillion for all companies. Predictions have crept up
since then, with New York University economist Nouriel Roubini
predicting losses to reach $2 trillion.
``It just keeps spreading from one asset to another, so
it's hard to know when these writedowns will stop,'' said Makeem
Asif, an analyst at KBC Financial Products in London. ``The U.S.
economy needs to stabilize first. But even then, Europe could
lag and recover later. There's still a lot more downside.''
Auction-rate securities have begun adding to the losses as
regulators and prosecutors force banks to buy back bonds they'd
sold as safe investments. UBS set aside $900 million to cover
potential losses from repurchasing the securities, while
Citigroup Inc. and Wachovia Corp. estimated losses at $500
million each.

Subprime Collapse

The collapse of the U.S. subprime mortgage market last year
has saddled banks worldwide with $501 billion of losses from
declining values of securities tied to all types of home loans
and commercial mortgages as well as leveraged-loan commitments.
Banks and brokers have raised $353 billion of capital to
cope with the writedowns, according to data compiled by
Bloomberg. The gap between losses and capital infusions, which
now stands at $148 billion, has regularly narrowed to about $80
billion as capital raising follows writedown announcements.
The following table shows the asset writedowns and credit
losses as well as the capital raised in response. All numbers
are in billions of U.S. dollars, converted at today's exchange
rate if reported in another currency. For quarterly breakdowns
for each bank and region, click on WDCI.

*T

Firm Writedown & Loss Capital Raised

Citigroup 55.1 49.1

Merrill Lynch 51.8 29.9

UBS 44.2 28.3

HSBC 27.4 3.9

Wachovia 22.5 11

Bank of America 21.2 20.7

IKB Deutsche 15.3 12.6

Royal Bank of Scotland 14.9 24.3

Washington Mutual 14.8 12.1

Morgan Stanley 14.4 5.6

JPMorgan Chase 14.3 7.9

Deutsche Bank 10.8 3.2

Credit Suisse 10.5 2.7

Wells Fargo 10 4.1

Barclays 9.1 18.6

Lehman Brothers 8.2 13.9

Credit Agricole 8 8.8

Fortis 7.4 7.2

HBOS 7.1 7.6

Societe Generale 6.8 9.8

Bayerische Landesbank 6.4 -

Canadian Imperial (CIBC) 6.3 2.8

Mizuho Financial Group 5.9 -

ING Groep 5.8 4.8

National City 5.4 8.9

Lloyds TSB 5 4.9

IndyMac 4.9 -

WestLB 4.7 7.5

Dresdner 4.1 -

BNP Paribas 4 -

LB Baden-Wuerttemberg 3.8 -

Goldman Sachs 3.8 0.6

E*Trade 3.6 2.4

Nomura Holdings 3.3 1.1

Natixis 3.3 6.7

Bear Stearns 3.2 -

HSH Nordbank 2.8 1.9

Landesbank Sachsen 2.6 -

UniCredit 2.6 -

Commerzbank 2.4 -

ABN Amro 2.3 -

DZ Bank 2 -

Bank of China 2 -

Fifth Third 1.9 2.6

Rabobank 1.7 -

Bank Hapoalim 1.7 2.4

Mitsubishi UFJ 1.6 1.5

Royal Bank of Canada 1.5 -

Marshall & Ilsley 1.4 -

Alliance & Leicester 1.4 -

U.S. Bancorp 1.3 -

Dexia 1.2 -

Caisse d'Epargne 1.2 -

Keycorp 1.2 1.7

Sovereign Bancorp 1 1.9

Hypo Real Estate 1 -

Gulf International 1 1

Sumitomo Mitsui 0.9 4.9

Sumitomo Trust 0.7 1

DBS Group 0.2 1.1

Other European banks* 7.2 2.3

Other Asian banks* 4.6 7.8

Other U.S. banks* 2.9 1.9

Other Canadian banks* 1.8 -
____ ____

TOTAL** 501.1 352.9