Countrywide Financial, Washington Mutual and several other finance companies were downgraded on Monday by Lehman Brothers analyst Bruce Harting, who said the U.S. credit downturn could result in $242 billion of mortgage-related losses.

Harting downgraded the mortgage finance sector to "negative" from "neutral," and the specialty finance sector to "neutral" from "positive. He cut Countrywide and IndyMac Bancorp to "underweight" from "equal weight," and Washington Mutual to "equal weight" from "overweight."