Merrill reports loss of nearly $10 billion

World’s largest brokerage slammed by the ongoing credit crisis

updated 10:33 a.m. ET Jan. 17, 2008

NEW YORK - Merrill Lynch & Co., the world’s largest brokerage, on Thursday posted a fourth-quarter loss of nearly $10 billion after writing down some $14.6 billion worth of investments and trades slammed by the ongoing credit crisis.

The company posted a net loss after preferred dividends of $9.91 billion, or $12.01 per share, compared to a profit of $2.3 billion, or $2.41 per share, a year earlier. Merrill had negative revenue of $8.19 billion, down from revenue of $8.39 billion a year earlier.

Results missed Wall Street’s projections for a loss of $4.70 per share on revenue of $702.1 million, according to Thomson Financial. However, analysts have not been able to make accurate projections since the summer, when investment banks began taking on large losses due to the collapse of the subprime mortgage market.

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“While the firm’s earnings performance for the year is clearly unacceptable, over the last few weeks we have substantially strengthened the firm’s liquidity and balance sheet,” said John A. Thain, Merrill’s new chairman and chief executive, in a statement.

Merrill said Tuesday it is getting a fresh cash investment of $6.6 billion to strengthen its balance sheet, led by three foreign investment groups. In December, it secured up to $6.2 billion of additional capital.