The Credit Crisis is Far From Over

From Bloomberg:

Fortis, Belgium's biggest financial- services company, scrapped a 1.3 billion-euro ($2 billion) cash dividend and will sell shares and assets to shore up capital as the earnings outlook deteriorates.

Fortis slumped as much as 12 percent to the lowest in five years after the company said today in a statement it will raise 8 billion euros by selling stock and ``non-core'' assets such as real estate. It is eliminating the interim dividend for the first time in at least three years.

Chief Executive Officer Jean-Paul Votron said he needs to take ``exceptional measures'' because the business environment won't improve anytime soon. Fortis is reeling after it spent 24 billion euros to buy part of Amsterdam-based ABN Amro Holding NV in the biggest banking takeover in history, just as the subprime mortgage market collapsed.

From Bloomberg:

Citigroup Inc., the bank that's posted the biggest losses from the collapse of the U.S. mortgage market, may take an additional $8.9 billion in net writedowns in the second quarter, Goldman Sachs Group Inc. said.

Goldman also lowered its rating on U.S. brokerages to ``neutral'' from ``attractive,'' saying the pace of deterioration in the industry ``appears to be far worse than'' it originally anticipated, according to a June 25 note.

``The turnaround in business trends that we had been expecting in the second half of 2008 may not occur as quickly as we should have thought,'' Goldman said. ``We see multiple headwinds for Citigroup,'' such as risks of further writedowns, higher consumer provisions, and the potential need for additional capital raisings, dividend cuts or asset sales, Goldman said.

From the BBC:

Barclays has said it is planning to raise £4.5bn ($8.8bn) in a share issue to bolster its balance sheet.

The firm is to sell shares to new investors, such as the Qatar Investment Authority, and existing shareholders including China Development Bank.

Barclays said the fundraising move would "strengthen its capital base".

It is the latest British bank, following the Royal Bank of Scotland and HBOS, to seek to raise money to ease the impact of the credit crunch.

And then there is this:

Goldman Sachs cut its rating on U.S. brokers to neutral from attractive, and put Citi on its conviction sell list, saying that while it still believes the market is putting too much weight on the possibility that another investment bank may fail, it is "hard pressed" to find a catalyst to move the group significantly higher over the next few months as fundamentals continue to deteriorate.

This is simply over the last two days. Add this so last week's news -- Citigroup announcing more writedowns and a Goldman Sachs report that regional banks will need an addition $65 billion -- and you get a very dour picture of the financials indeed.