Alliance & Leicester reported a 30% fall in profit last year after being hit by a £185m writedown on its investments in the credit market, The Times reports.
Britain's seventh-largest bank revealed this morning that pre-tax profit plunged from £569m for 2006 to £399m for the 12 months to December 31. The bank last month said that it would take a £185m charge on its investments in structured investment vehicles (SIVs) and collateralised debt obligations (CDOs), after they lost value in the global liquidity crisis.
The write-down was more than three times higher than an estimate given late last year of £55m. The bank has £15bn worth of exposure to the credit markets.
BARCLAYS PRESIDENT BOB DIAMOND is preparing an assault on Wall Street's biggest investment banks after the British lender emerged relatively unscathed from the credit crunch, The Telegraph reports.
The high street bank contained its sub-prime fall-out for 2007 to write-downs of just £1.64bn, only £300m more than unveiled in November. By comparison, Citigroup, Merrill Lynch and Morgan Stanley all revealed several billion dollars of secondary provisions.
Mr Diamond, who heads investment bank Barclays Capital, asset manager Barclays Global Investors and private bank Barclays Wealth, said: "The biggest opportunity is the investment banking industry in the US.
CREDIT SUISSE SHOCKED THE MARKET yesterday after admitting $1bn (£510m) had been wiped off its first-quarter profits by worsening market conditions, and that it had suspended "a small number" of traders who had contributed to the losses with pricing errors, The Independent reports.
The Swiss banking giant said it had been forced to write down $2.85bn on asset-backed securities in the first three months of the year, less than a week after its chief executive had praised the bank's resilience in the wake of the credit crunch. The news, described by one analyst as "embarrassing", sent its share price spiraling down as much as 10% in the morning, although the stock rallied slightly to end 7.22% down at Sfr52.65.
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