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Home loans dive at Bear Stearns
24.10.08
Bear Stearns' mortgage portfolio has fallen 9% in value in the third quarter, leaving a bill of $2 billion (£1.24 billion) to be picked up by the US taxpayer.
The investment bank's portfolio, originally worth $30 billion, lost some $2.7 billion as property prices tumbled, the Federal Reserve said.
JPMorgan Chase agreed in March to buy Bear Stearns but only if the government guaranteed some of its assets. JPM agreed to take about the first $1.15 billion of losses from the portfolio, with US taxpayers bearing the rest. The decline in the value of the Bear Stearns mortgage assets has so far been about $3 billion.
Meanwhile, foreclosure notices in the US soared to a record high in the third quarter. More than 750,000 homeowners received at least one foreclosure-related filing between July and September, an increase of 71% on a year earlier, according to RealtyTrac, an online listings service for foreclosure properties.
