Mortgage woes keep piling up

0 Comments | USA TODAY, November, 2007 | by Greg Farrell

NEW YORK -- Fallout from the meltdown in the subprime mortgage industry continued to wreak havoc on Wall Street Wednesday, as three big financial institutions revealed new financial and legal problems, and shares of the USA's leading banks and brokerage firms sank.

Morgan Stanley announced new subprime-related losses, while Merrill Lynch and Citigroup began to grapple with the regulatory and legal consequences of their recent announcements of bigger-than-expected write-downs:

*Morgan Stanley estimated that its credit losses had grown by $3.7billion since August. Two months ago, Morgan Stanley said its maximum exposure to securities comprised of subprime-related loans was $10.4 billion; with the write-down, that exposure has now been reduced to $6billion, the...