Bank of America Net Drops 77%

NEW YORK, April 15, 2008 (PRIME NEWSWIRE) — Beleaguered investors of Washington Mutual (NYSE:WM) were delivered more bad news by the company in Tuesday’s after-hours earnings announcement. The company reported a first-quarter loss of $1.14 billion and indicated that it expects Writedowns of $12 billion to $19 billion of its $187 billion portfolio of single family residential home loans in 3 to 4 years.

Litigation on behalf of Washington Mutual employees and 401(k) plan participants has commenced against the company for alleged violations of the Employee Retirement Income Security Act (ERISA) in the United States District Court for the Western District of Washington. If you are an employee of Washington Mutual and wish to discuss the investigation or have questions concerning this notice or your rights, please contact Scott+Scott (scot...@scott-scott.com, (800) 404-7770, (860) 537-5537), for more information. There is no cost or fee to you.

Ben Bernanke gave a speech today where he is urging lenders to write down the principle of the loans to distressed homeowner is where the price has fallen.

Is the Federal Reserve chairman breaking new ground on fed communication?

We have seen $90 billion of writedowns to date. Standard and Poor’s is saying that you can super size that order. Writedowns total losses are expected to be $265 billion or more.

So far, Wall Street has been shouldering the brunt of the losses. S&P says the next losses will affect smaller financial institutions including regional banks in the U.S., credit unions, and lenders in Europe and Asia.

Just yesterday, UBS, the biggest Swiss bank, wrote down $14 billion of assets.

$18.1 Billion in writedowns and 4,200 layoffs. US Banks are a good buy for foreigners?

How bad of an idea is this?

We have heard some of this before, Citigroup may have to write down the value of mortgage backed investments by $12 billion, according to Sanford Bernstein. In a note to the company, they said Citigroup may post a loss. Last month Goldman Sachs said Citigroup may have to cut back its holdings by $9 billion. Meanwhile, Bank of America could also face writedowns of $5.5 billion while JP Morgan Chase may have to write down $1 billion.

Credit Suisse Questions Washington Mutual Management

In a new research report, Credit Suisse calls into question the “credibility” of Washington Mutual’s management, citing what it calls “numerous upward revisions” to the thrift’s credit expectations on future writedowns.

“We are concerned by the deterioration of WaMu’s credit metrics and we do not believe WaMu is out of the woods,” writes analyst Moshe Orenbuch. (The nation’s largest thrift recently raised $3 billion in convertible preferred stock, offering a coupon of 7.75% on the notes).

Credit Suisse predicts that WaMu faces credit losses of nearly $5 billion in 2008, with an additional $3.55 billion of reserve additions. “We believe that (nonperforming assets) should increase to roughly $10 billion or 3% of total assets,” Mr. Orenbuch says. Credit Suisse has a “neutral” rating on the stock.

In trading Tuesday, WaMu’s share price fell to a new 52-week low of $14.11. Its high is $46.

A Worsening Outlook: Bank of America. Rising Credit Losses, Problems in Credit Cards and Home Equity, Writedowns on CDOs “Unknowable”, Charge-Offs Will Rise Next Year; CEO Ken Lewis Will Face More Problems as Consumer Spending Slows; Some Say Bank of America Stock Will Outperform the mortgage industry.

Bank of America, PNC Financial, Wachovia Announce $5+ Billion In Writedowns. Bank of America Says Provision Cost Reflecting Boosted Reserves; PNC Financial 4Q Forecast Below Analyst Estimates, Increases Provision and Revises 2008 Forecast; Wachovia Sees 4Q Provision Expense $1 Billion Higher Than Charge Offs.

UBS Writedowns in Depth. The Swiss bank, UBS, reveals a massive writedown linked to turmoil in U.S. subprime mortgage sector.