Subprime mortgage bond losses are likely to total as much as $550 billion, or about half the value of all first-mortgage subprime debt issued in the past three years, Standard & Poor’s Chief Credit Officer Mark Adelson said, as Bloomberg reports.
Banks and brokerages have already written down $508.5 billion in holdings, according to Bloomberg data, and Adelson’s estimate may be a sign that much of the damage to bondholders from the credit crisis has been accounted for.
“There’s a lot of double counting involved because most of that paper is held by CDOs,” says Adelson.
The full article is available at the Bloomberg web-site.
D.C.