Investors fear for US bank losses
By Francesco Guerrera in New York
"Wall Street is bracing itself for a week dominated by news of large losses, multibillion dollar writedowns and thousands of job cuts as Citigroup and Merrill Lynch, two of the worst casualties of the credit crunch, report results.
Investors and bankers fear that another set of dire numbers by the two lenders will reverse the slight improvement in sentiment in recent weeks and quash hopes of an end to the financial turmoil soon.
First-quarter results at the two banks are expected to be hit by huge markdowns on their portfolios of mortgage-backed securities and leveraged loans.
Citi is likely to report a writedown of more than $10bn, while Merrill Lynch could suffer a writedown of more than $7bn, according to analysts.
Vikram Pandit, Citiï¿½??s chief executive, is working on a cost-cutting plan that could cut more than 25,000 of the companyï¿½??s 370,000 employees. John Thain, his counterpart at Merrill Lynch, is also in the throes of a restructuring that could axe more than 2,000 jobs."
The orchestra is warming up…