Thursday, December 20, 2007
Bear Stearns reports first quarterly loss in 84 years
Bear Stearns on Thursday reported its first quarterly loss following a writedown of $1.9bn on its mortgage inventory, nearly twice the amount it had told investors to expect. “We are obviously very upset with our 2007 results, particularly in light of the fact that weakness in fixed income more than offset strong and, in some areas, record-setting performance in other businesses,” said Jimmy Cayne, chief executive. “Our underlying fixed income business remains strong and we have taken steps to size the division to market conditions.” Mr Cayne, along with other top Bear executives, has agreed to forgo a bonus for 2007. John Mack, Morgan Stanley chief executive, made a similar move on Wednesday when the bank announced a loss for the fourth quarter and a $9.4bn writedown.