After the knives came out for Stan O’Neal at the weekend, a few of the Merrill Lynch chief’s counterparts will be looking nervously over their own shoulders.

Despite all the marketing blurb promoting their own unique expertise in capital markets, the big Wall Street banks have remarkably similar investment portfolios. They share broadly the same asset allocations and are exposed to the same markets. Each of the big banks will have been worrying whether the trauma that Merrill Lynch is experiencing very publicly – both on its balance sheet and in its boardroom – will be reenacted where they are.

Thus when Mr O’Neal was forced to admit last week in a conference call that the bank had no idea where the market was going, effectively conceding that there may be more losses to come, financial analysts would have been listening in for clues about how to gauge their own banks’ exposure as much as Merrill Lynch’s bottom line.

As soon as Merrill revealed that it had written off $7.9 billion (£3.8 billion) of bad investments – mainly bonds backed by toxic sub-prime mortgages – Wall Street pencilled in another $5 billion of losses still to come. Those losses had already been revised up from the $5.9 billion that the bank had estimated only a few weeks before, indicating how rapidly the outlook for those investments had deteriorated.

Charles Prince, the chairman and chief executive of Citigroup, has managed to keep the wolves from the door by dismissing a few underlings. Citigroup is one of the most heavily exposed of the Wall Street banks to losses in the sub-prime mortgage market.

Two weeks ago, he announced a radical shake-up of the bank’s top management, in which he sacked Randy Barker, co-head of Citigroup’s fixed-income business, and moved Geoff Coley, Mr Barker’s co-head, to another job. Tom Maheras, who ran Citigroup’s capital markets operations, including the division run by Mr Barker, also left, apparently out of loyalty to Mr Barker.

The changes did not, however, halt the calls for Mr Prince’s head. They seem merely to have bought him time, despite assurances from Bob Rubin, head of Citigroup’s executive committee, that Mr Prince would remain in his job for several more years.

Analysts at Bear Stearns said that if the reshuffle did not improve the bank’s performance, Citigroup’s board would have to “conclude that a more significant change, at CEO level, is required”. This month, the bank unveiled plans for a $90 billion bailout fund to which all the banks could sell their affected sub-prime investments. Citigroup, with the greatest exposure, would be the biggest beneficiary.

Elsewhere, there have also been questions abut the tenure of Jimmy Cayne, the chief executive of Bear Stearns. Investor discontent with the management team has been widely reported and that feeling was unlikely to have been helped by Bear Stearns’s decision to close two of its hedge funds this year after the pair lost $1.5 billion between them. Last month the bank reported a $700 million write-down on the value of its mortgage holdings and leveraged loan commitments in the third quarter. Mr Cayne has been away from the office because of ill-health and, with expectations in some quarters of a fourth-quarter writedown still to come, there has been speculation that it is time for the 73-year-old boss to step aside.

According to the outplacement firm Challenger, Gray, and Christmas, this has been the worst year for job losses in financial services on record. About 130,000 jobs have been cut by US financial firms, on and off Wall Street, as a direct result of the sub-prime mortgage crisis. Bank of America lost 3,000 jobs last week in its investment banking division, while Morgan Stanley cut 300, Bear Stearns 310, HSBC 750 and UBS 1,500. Countrywide, America’s biggest mortgage lender, made 12,000 workers redundant, along with IndyMac Bancorp’s 1,000 job cuts. More than 80 per cent of this year’s job cuts have been made in the past two months.

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