Merrill Sees More Writedowns

Merrill Lynch, which has agreed to be acquired by Bank of America, took another set of partially mortgage-related multibillion-dollar writedowns in the third quarter that contributed to a net loss of $5.2 billion. The writedowns included $5.7 billion resulting from a previously announced sale of super-senior asset-backed security collateralized debt obligations. Another $3.8 billion was lost principally from severe market dislocations in September, including real estate-related asset writedowns and losses related to certain government-sponsored entities and major U.S. broker-dealers, as well as the default of a U.S. broker-dealer. In addition, $2.6 billion in net losses resulted primarily from completed and planned asset sales across residential and commercial mortgage exposures.