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Monday, October 1, 2007

Citigroup Sees Earnings Falling 60% from Last Year




October 1 2007 BusinessWeek.com
Citigroup Inc., the nation's largest financial institution, warned Monday its third-quarter earnings are likely to decline 60 percent, as it takes more than $3 billion in writedowns for securities backed by underperforming mortgages and loans tied to corporate buyouts. The announcement from Citigroup came as the Swiss bank UBS AG said it will post a loss of up to $690 million in the third quarter partly due to losses linked to U.S. subprime mortgages. Subprime mortgages -- loans given to customers with poor credit history -- have gone delinquent or defaulted at rising rates in recent months, causing banks to lower the value of the loans as investors shy away from buying them.

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