Countrywide Financial

Countrywide Financial, America's largest mortgage lender, was rescued by an $11.5 billion (£5.8 billion) cash injection from 40 of the world's biggest banks, only hours after Merrill Lynch said that it could face bankruptcy. Countrywide gave warning this week that more than 5 per cent of its mortgages were classified as "delinquent".

IKB

The German bank IKB admitted that it faced £12 billion of exposure to the sub-prime market. Nervous about the potential impact of such losses, the German Government helped to back and organise a €3.5 billion (£2.4 billion) bailout and pledged to guarantee the lender’s loan obligations of more than €8 billion through the state-backed lender – and IKB'S largest shareholder – KfW.

BACKGROUND

• Elephant slumps in wake of crunch

• Heads on the block, investors call for change

• Credit crunch forces Delek to leave property deal

• US rate cut looks certain after new data

• Bank of America to axe 3,000 after 'our errors'

BACKGROUND

• More pain for private equity industry

• Russian state bank poised to boost liquidity

• House prices‘to stay flat for years’

• Will soaring oil pump up inflation?

• US bank slump goes on

Black clouds loom on horizon

For the first time in 15 years, I am seriously worried about the outlook for the economy, the housing market and sterling

Float on the job market

Don't believe the scary headlines. It's not the worst time to consider a career in banking

Bear Stearns

Blackstone, the US private equity group, launched rescue talks in June to try to prevent the collapse of two hedge funds run by Bear Stearns, High Grade Structured Credit Strategies Enhanced Leverage Fund and the High Grade Structured Credit Strategies Fund, which together control investments totalling $20 billion. Both had invested the majority of their funds in risky, sub-prime related securities. It emerged that Barclays was a key lender, with $300 million invested in the fund. Bear Stearns then launched a $3.2 billion rescue for the High Grade Structured Credit Strategies Fund.

BNP Paribas

BNP Paribas, France's largest bank by market value, froze withdrawals and suspended three funds worth a total of €2 billion (£1.35 billion) last week – Parvest Dynamic, ABS, BNP Paribas ABS Euribor and BNP Paribas ABS Eonia. The bank said that "the complete evaporation of liquidity in certain market segments of the US securitisation market has made it impossible to value certain assets fairly regardless of their quality or credit rating." But the move surprised investors. It came only a week after Baudouin Prot, the chief executive of the bank, said that it was unaffected by the sweeping sub-prime crisis.

New Century Financial

The first big casualty of the sub-prime crisis was New Century Financial, which filed for Chapter 11 bankruptcy protection on April 2. The California-based group had extended about $60 billion (£30 billion) in loans during 2006. It emerged that New Century numbered some of Wall Street's biggest names among its creditors, including Goldman Sachs, Credit Suisse, Deutsche Bank, Bank of America, Lehman Brothers, UBS, Citigroup and Countrywide Financial. Morgan Stanley, UBS and Barclays had credit lines to the company of $3 billion, $2 billion and $1 billion, respectively.

Accredited Home Lenders

On Monday Accredited announced that it was suing Lone Star, the private equity company, after it withdrew its agreed takeover.

Lone Star and Accredited agreed a $400 million (£198 million) deal in June, but Lone Star withdrew its offer last Friday, citing “drastic deterioration in the financial and operational condition of [Accredited], among other things”. Accredited acknowledged last week that it had offered 59 per cent fewer loans in the second quarter of the year compared with the same period in 2006. It also said the delinquency rate on its mortgages had tripled and that it would fall into the red with a loss of between $40 million and $60 million.

KKR Financial Holdings

KKR Financial Holdings, an arm of the private equity giant Kohlberg Kravis Roberts, said on Wednesday that it faced losses of about $40 million (£20 million) after selling $5.1 billion in residential mortgage loans. It also gave warning of further possible losses amounting to $250 million.

In addition, KKR found itself unable to offload any of its debt in advance of its acquisition of Alliance Boots, as investors were reluctant to take on the high-risk loans.

AHM

American Home Mortgage Investment (AHM) followed New Century's fate when it was forced to file for Chapter 11 bankruptcy protection on August 6. AHM, America's tenth-biggest mortgage lender, had earlier cut cut 6,000 jobs. Deutsche Bank and JPMorgan were named as its biggest lenders. While the extent of AHM's liabilities was not immediately clear, during the three months to March 31, 2007, AHM's assets totalled $20.5 billion (£10.1 billion), just covering its $19.3 billion liabilities.

HSBC

HSBC, Britain's largest bank, acknowledged that a 34 per cent fall in profits at its UK retail business was due in part to the $236 million it had spent on refunding unauthorised overdraft fees after a backlash by UK customers against paying large sums for exceeding their borrowing limit. Its bad-debt provisions more than doubled in the first six months of the year to $6.3 billion (£3.1 billion) as it predicted further difficulties related to the collapse of the sub-prime market.

Man Group

Man Group, the world's largest hedge fund manager, took pre-emptive action last month, cutting the value of its broking business, MF Global, by almost $1 billion (£500 million) before its New York float. Peter Clarke, the chief executive, cited the anxieties emanating from the sub-prime market.

Goldman Sachs

In the first indication that troubles in the US housing market were extending into the wholesale market, Goldman, along with Bear Stearns, held the sub-prime problems directly accountable for falling revenues at their mortgage trading arms in June.

UBS

Losses of £62 million in the US mortgage securities market forced UBS to close its £2.5 billion hedge fund, Dillon Reed Capital Management, less than two years after its launch. This week UBS said that market turmoil accounted for weak profits.

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