Bear takes $859 million 4Q hit

The Bear Stearns Cos. Inc. posted its first quarterly loss in the company's 84-year history.
DEC 20, 2007
The Bear Stearns Cos. Inc. posted the first quarterly loss in the company's 84-year history. The New York-based financial services company lost $859 million, or $6.90 per share, for the quarter ended Nov. 30, compared to a profit of $558 million or $4 per share during the same period in 2006. Bear said that it would record a $1.9 billion write-down for subprime-related investments and fixed-income trading, higher than the $1.2 billion write down that the company estimated last month. The company recorded a $956 million four quarter loss in its capital markets business, down from net revenues of $1.9 billion in the fourth quarter of 2006. The company confirmed earlier reports that members of its executive committee, including chairman and chief executive officer James E. Cayne, will not receive bonuses this year. "We are obviously upset with our 2007 results, particularly in light of the fact that weakness in fixed income more than offset strong and, in some areas, record-setting performance in other businesses," Mr. Cayne said, according to a statement. The results for the company were not all negative. Revenue in the wealth management division increased 10% from last year to $272 million and global clearing services increased 2% to $276 million. The New York-based financial services company lost $859 million, or $6.90 per share, for the quarter ended Nov. 30, compared to a profit of $558 million or $4 per share during the same period in 2006. Bear said that it would record a $1.9 billion write-down for subprime-related investments and fixed-income trading, higher than the $1.2 billion write down that the company estimated last month. The company recorded a $956 million four quarter loss in its capital markets business, down from net revenues of $1.9 billion in the fourth quarter of 2006. The company confirmed earlier reports that members of its executive committee, including chairman and chief executive officer James E. Cayne, will not receive bonuses this year. "We are obviously upset with our 2007 results, particularly in light of the fact that weakness in fixed income more than offset strong and, in some areas, record-setting performance in other businesses," Mr. Cayne said, according to a statement. The results for the company were not all negative. Revenue in the wealth management division increased 10% from last year to $272 million and global clearing services increased 2% to $276 million.

Latest News

Fintech bytes: Vestmark, NDEX, and Forms Logic partnerships sharpen RIA tools
Fintech bytes: Vestmark, NDEX, and Forms Logic partnerships sharpen RIA tools

First Trust models, Schwab-linked data tools and Orion transition tech headline a busy week for RIA wealthtech

Two LPL executives jump to competitors as 2026 comes to a close
Two LPL executives jump to competitors as 2026 comes to a close

The change in senior personnel occurs days after LPL Financial tapped a new head of recruiting.

Osaic names new CMO and Empowered Independence head
Osaic names new CMO and Empowered Independence head

Former PulteGroup and Citizens executives join the broker-dealer network after a year of senior leadership departures

RIA moves: Prospera lands $600M Cornerstone team in Rochester
RIA moves: Prospera lands $600M Cornerstone team in Rochester

Independent RIA Concurrent adds over $1B across six moves, while OnePoint BFG opens West Palm Beach with a $240M team

Creative Planning adds $2.2B fee-only RIA Rockbridge in Syracuse
Creative Planning adds $2.2B fee-only RIA Rockbridge in Syracuse

The mega-RIA keeps absorbing independent fiduciary firms as Cerulli data shows the fee-only segment losing asset share

SPONSORED Built on insurance experience to deliver on long-term promises

Knighthead Life entered the market with a competitive MYGA. A strong launch earned advisor confidence and paved the way for FIAs.

SPONSORED In the Age of AI, Trust Becomes the Advisor's Greatest Asset

As AI makes financial information more accessible than ever, Lana Hock explains why human judgment, trust, and empathy remain the qualities clients value most in a financial advisor