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B of A to take $3-billion debt writedown

By Times Wires
Published November 14, 2007

CHARLOTTE, N.C.

Bank of America Corp. said Tuesday it will take a $3-billion debt-related writedown in the fourth quarter and warned its losses could grow, adding to fears the nation's housing and mortgage-lending slump might exact a greater toll than in the wretched third quarter, when industrywide writedowns topped $40-billion. The Charlotte-based bank said it will also spend about $600-million to support a group of its money market funds because of "uncertainty around the value" of the funds' investments. Of specific concern are the funds' holdings in structured investment vehicles, which use borrowed money to make risky but potentially high-yielding investments.

WASHINGTON

Budget deficit up sharply in October

The government started the new budget year with an October deficit of $55.6-billion, up sharply from last year even though government revenue hit an all-time high for the month. The Treasury Department reported Tuesday that the deficit for the first month in the new budget year was up 12.6 percent from the imbalance in October 2006. The Congressional Budget Office is forecasting that the imbalance for the entire year will show an improvement from last year, when the deficit fell to $162.8-billion, a five-year low. The CBO is projecting that the deficit for the current 2008 budget year will decline to $155-billion.

T-bill rates fall

Interest rates on short-term Treasury bills fell in Monday's auction. The Treasury Department auctioned $20-billion in three-month bills at a discount rate of 3.430 percent, down from 3.550 percent last week. An additional $19-billion in six-month bills was auctioned at a discount rate of 3.625 percent, down from 3.780 percent last week.

[Last modified November 14, 2007, 00:58:52]