National City Sets Aside $700M for Loan Losses, Says Worst May Be Over

Dec.17.07 | About: National City (NCC)

National City (NCC) said Monday it will take a $200 million charge this quarter related to defaults and distressed mortgages. The regional bank also said it would reserve about $700 million to cover increasing delinquencies and future defaults, after setting aside $361 million to handle losses for bad loans in the third quarter. "The mortgage business continues to be under stress," the company said. It did, however, signal the worst may be over. "As of the end of November, the balance of loans in the warehouse consisted mainly of agency-eligible and other loans deemed readily salable, and no additional losses of significance are expected," it said in a SEC filing. It said fourth-quarter net interest income will likely be "flat to down slightly" compared to the third quarter. Shares of National City fell 0.7% to $16.51 Monday.

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