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The past two weeks have been nothing short of tumultuous for markets in Asia. Stocks first hurtled downwards faster than if you threw a boulder off a cliff. Then this week saw stocks rallying, with markets making back almost all of the losses suffered the week before. It's easy to make money in these situations. But for those who do not see volatility as a friend, investing in a fund with a long-term strategy may be more the thing for you.
BNP Paribas said on Thursday it would reopen next week three investment funds it had frozen this month amid subprime volatility in a step that may help restore investor confidence, which took a hit on their suspension.
Three of Asia's biggest banks, including state-run giant Bank of China, revealed bigger-than-expected exposure to the U.S. subprime mortgage crisis, sending their shares skidding on Friday.
DBS Group Holdings, Southeast Asia's biggest bank, said on Friday it has more direct exposure to collateralized debt obligations than previously declared, sending its shares down over 2%.
Shares in Bank of China and its subsidiary BOC Hong Kong slid on Friday amid worries that higher-than-expected exposure to sub-prime mortgages would eat into their earnings.
Investors in $5 billion of commercial paper, or short-term debt, from KKR Financial Holdings have hired a bankruptcy lawyer to advise them on a request to delay repayment, the Wall Street Journal reports.
U.S. stocks bounced off earlier lows but closed with small losses amid ongoing worries regarding the global credit environment. "The conventional logic was that the worst was behind us but then reality set in and there's still trouble out there," said Dan McMahon, head of listed trading at CIBC World Markets.
Banks have stepped up their borrowing from the Federal Reserve, a development encouraged by central bank policymakers to help stem a credit crunch that has roiled Wall Street.
Accredited Home Lenders Holding said on Thursday that Chief Financial Officer John Buchanan is resigning effective Aug. 31.
The unofficial transcript of a CNBC exclusive interview with Countrywide CEO Angelo Mozilo on CNBC's "The Call."
The chief executive of Countrywide Financial told CNBC that Bank of America's $2 billion investment in the struggling mortgage lender was a "priceless endorsement" for Countrywide but said the crisis in the housing and mortgage markets isn't getting any better.
A private equity-led buyout of home-improvement retailer Home Depot's wholesale supply division, due to close on Thursday, could be in trouble because investment banks involved are reluctant to fund the transaction even at a lower price, the Financial Times reported in its online edition, citing people familiar with the negotiations.
Bank of America's decision to throw Countrywide Financial a $2 billion lifeline is far more than BofA telling Countrywide 'here's some money, pay us back when you can'. Countrywide is paying dearly for the injection.
Shares of Thornburg Mortgage, Accredited Home Lenders Holding and other mortgage stocks were trading higher before the opening bell Thursday after Bank of America made a $2 billion investment in Countrywide Financial.
Moody's Investors Service said German state-owned Landesbanks were very rich in liquidity as a group and would not need to seek liquidity support either individually or as a group from a regional government.
Bank of America, said on Wednesday it would invest $2 billion in Countrywide Financial, helping shore up the finances at the largest U.S. mortgage lender, which has struggled with a liquidity crunch this month.
A late rally pushed U.S. stocks sharply higher at the close as takeover news and rate-cut speculation overshadowed jitters about tighter credit markets. "We think that liquidity is returning to the market after being problematic," said Kevin Cronin, head of investments at Putnam. "We think the Fed's actions last week righted the ship."
Accredited Home Lenders Holding said on Wednesday it had stopped taking mortgage applications and would eliminate 1,600 jobs, or 62 percent of its work force, to cope with turmoil in subprime lending.
Quality Home Loans, a subprime mortgage lender, has filed for Chapter 11 bankruptcy, joining at least a dozen other home loan providers to seek court protection this year as the U.S. housing market slumped.
A global credit squeeze has most economists convinced the Federal Reserve will come to the rescue and cut interest rates next month, a Reuters poll showed on Wednesday.