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Merrill posts $7.5 bn third-quarter loss

Merrill posts $7.5 bn third-quarter loss
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First Published: Thu, Oct 16 2008. 05 05 PM IST
Updated: Thu, Oct 16 2008. 05 05 PM IST
New York: Merrill Lynch & Co reported a third-quarter net loss of $7.5 billion on write-downs and credit losses on complex debt securities.
The brokerage house, which last month accepted a takeover bid from Bank of America, said on Thursday that the net loss applicable to common shareholders widened to $5.58 per share from $2.3 billion, or $2.82 per share, a year earlier.
The loss was worse than analysts’ expectations of a $5.18 loss per share, according to Reuters’ Estimates.
Merrill, like former peers Lehman Brothers and Bear Stearns Cos, has struggled to survive the credit crisis, which has crippled its large mortgage and complex debt businesses.
In July, Merrill sold a $30.6 billion portfolio of toxic securities to private equity firm Lone Star Funds, taking a write-down and raising capital in the process - but this was not enough to end its problems. The company’s share price continued to fall, and Chief Executive John Thain engineered the speedy sale to Bank of America on the same weekend that Lehman Brothers was forced into bankruptcy.
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First Published: Thu, Oct 16 2008. 05 05 PM IST