It was the first loss in the history of the company, which decided top executives would not receive bonuses. Bank of America analyst Michael Hecht said Bear's smaller bonus pool could lead to attrition and hinder a strong rebound.
Bear Stearns said it took a $1.9 billion write-down in the fourth quarter ended Nov. 30, reflecting the reduced value of subprime mortgage-related securities. That was bigger than the $1.2 billion the company estimated in early November.
The quarterly net loss of $854 million, or $6.90 a share, compared with a year-earlier profit of $563 million, or $4 a share.
The loss was nearly four times bigger than the $1.80 a share that analysts were expecting, according to Reuters Estimates.
Goldman Sachs analyst William Tanona said the good news was that Bear's subprime mortgages problems might be largely over, but there is doubt that the company is diversified enough to recover as quickly as rivals.
Bear Stearns' shares were down for much of the session, but rallied late in the day as the broader market rose, closing up 82 cents at $91.42 on the New York Stock Exchange. The stock has fallen nearly 44 percent this year, compared with a 16 percent decline for the Amex Securities Broker Dealer index .XBD.
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source: reuters.com
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