Mismarkings and pricing errors by "a small number of traders" at Credit Suisse, Zurich, have led to increases in the fair-value reductions of "certain asset-backed positions" in the company's structured credit business within investment banking. The fair-value reductions to these positions "reflect significant adverse first quarter 2008 market developments" and are estimated at approximately $2.85 billion, with an estimated net income impact of approximately $1 billion, Credit Suisse reported. The company said that so far, even with the increased reductions, it remains on track to turn a profit in the first quarter. The reductions may also affect previously released 2007 results. The investment banking/structured credit business on Wall Street has generally been hard hit by the credit crunch stemming from U.S. mortgage woes.
