Barclay's shares initially jumped more than 6 percent on Thursday, but pared gains as analysts said growth this year and next will be restricted, and that market conditions remain unpredictable.
"The Barclays statement represents current knowledge of their problems," said Peter Dixon, UK economist at Commerzbank. "It doesn't necessarily mean that there won't be problems in the future. Uncertainties still remain the order of the day."
In a similar vein, Swiss banking giant UBS moved to douse speculation it would book fourth-quarter write-downs in the order of $8 billion. Still, it said it did not yet know if it would make further charges in subsequent quarters.
A spokesman said the Swiss bank was not keeping more writedowns in reserve with the intention of spreading the charges over several quarters. "We are not holding back further charges," he said.
UBS reported its first quarterly loss in five years at the end of last month after writing down $3.92 billion of subprime-linked exposures.
NovaStar: Bankruptcy Possible
NovaStar Financial shares sank by roughly half on Thursday after the company, which has halted subprime mortgage lending, quarterly posted a big loss and said bankruptcy is possible.
The company late Wednesday posted a $598 million third-quarter loss, or $64.05 per share. Results reflected a nearly ten-fold increase in bad loans, mortgage write-downs, higher legal bills, a charge to end the company's real estate investment trust status, and other items.
Meanwhile, Wells Fargo , which has sidestepped many of the credit and liquidity problems plaguing U.S. mortgage lenders, believes the nation's housing slump is the worst since the Great Depression and is far from over, Chief Executive John Stumpf said.
Stumpf nevertheless said the second-largest U.S. mortgage lender and fifth-largest U.S. bank is well-positioned to ride out the storm, despite expectations for "elevated" credit losses from home equity loans into 2008.
"We have not seen a nationwide decline in housing like this since the Great Depression," Stumpf said at a banking conference in New York. "I don't think we're in the ninth inning of unwinding
this," he continued, using a baseball reference. "If we are, it's an extra-inning game."
Lehman 'Very Comfortable'
On Wednesday,Lehman Brothers said it doesn't expect substantial write-downs of its most illiquid assets.
Co-Chief Administrative Officer Ian Lowitt said the investment bank remains "very comfortable" with its valuation of so-called level 3 assets on its books. Level 3 assets trade infrequently and are valued based on a bank's own estimates.
Lowitt added that the asset-backed securities business, which is currently in a deep freeze, will come back eventually.
Bear Stearns, which on Wednesday announced $1.2 billion of write-downs in the fourth quarter, was downgraded on Thursday by Standard and Poor's because of the writedown and subprime mortgage exposure.
-- Reuters contributed to this report.