The pain is far from over yet for banks

Shares in Credit Suisse plunged by as much as 9% on a shock $2.8bn writedown, just when confidence in the sector had already been undermined by reports that UBS could face up to $10bn in losses this year.

What "teeth-clenchingly bad timing", as Patrick Hosking put it in The Times. Only 48 hours after Qatar's sovereign wealth fund piled into Credit Suisse, the Swiss bank's shares plunged by as much as 9% due to a shock $2.8bn writedown on mortgage-based derivatives, blamed on asset mispricing by traders. The write-off is 50% higher than the 2007 total announced only last week.

Confidence in the sector had already been undermined by reports that UBS, which has already lost $18bn on mortgage-related securities, could be facing another $10bn in losses this year.

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