Several weeks ago, I told you we were staring "S&L Crisis II" in the face. I said estimates of losses stemming from the mortgage crisis kept spiraling higher — from $100 billion ... to $250 billion ... to $400 billion and higher.
I wish I could say things are getting better. But they're not. In fact, the tally of charges, losses and write-downs across the financial industry continues to rise higher and higher.
Just look what's happened in the past several days ...
National City (NCC), the super-regional bank, said it will slash another 900 jobs, bringing the total number of cuts to 3,400 in the past year. It also cut its dividend in half— the first payout reduction since 1935. And it said residential mortgage volume would come in between $15 billion
and $20 billion for 2008. The previous projection was $36 billion!
KeyCorp (KEY) said it would cease lending to many home builders and get out of the national home improvement lending business. The bank also announced charge-offs of about $110 million related to bum real estate development loans in markets like Florida and California ... and another $55 million to $65 million in losses stemming from commercial mortgage loan holdings.
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