Morgan Takes $5.7B in Additional B&C Hits

Morgan Stanley, a top player in home equity and asset-backed securities, took a $9.4 billion writedown in its fiscal fourth quarter, citing declining values in the subprime market.In November the Wall Street firm disclosed $3.7 billion in subprime writedowns, but on Wednesday it revealed $5.7 billion in additional charges. In its earnings statement, Morgan blamed the writedowns on "continued deterioration and lack of liquidity in the market for subprime and other mortgage-related securities." Roughly $7.8 billion of the writedowns are tied to subprime trading positions. For the quarter, Morgan posted a $3.58 billion operating loss. Morgan owns Saxon Mortgage, a nonprime wholesaler that recently cut back its loan menu. Morgan Stanley can be found online at http://www.morganstanley.com.