Merrill sparks fears bank crisis costs to soar

Merrill Lynch & Co's surprise write-down ratchets up pressure on rivals to cut the values of their own subprime assets as they grapple with mounting debts and economies weaken.

The global credit crisis, roughly a year under way, could cause total damage of around $1 trillion to balance sheets of financial services companies. That's far above the more than $400 billion of write-downs taken so far.

Merrill's revelation of a $5.7 billion write-down and plans to sell $8.5 billion of stock heightened worry of more pain to come from European lenders UBS AG and Barclays Plc, and from Wall Street and U.S. commercial banks.

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