Northern Rock hits all-time low (CNN)

LONDON, England (AP) -- The roller coaster ride continued for battered mortgage lender Northern Rock Tuesday, with its shares tumbling 40 percent to an all-time low amid uncertainty about its future before some of those losses were pared as a potential new buyer for the entire business emerged.

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Citigroup Warns of 60% Earnings Drop

By ERIC DASH and JULIA WERDIGIER

Citigroup issued a profit warning today, estimating a 60 percent drop in third-quarter earnings because of write-downs for securities backed by subprime mortgages and loans tied to corporate takeovers.

Separately, UBS, Europe’s biggest bank, predicted an unexpected loss in the third quarter because of a $3.42 billion write-down for the value of mortgage-backed securities and announced a management shake-up.

Citigroup said it expects its third-quarter net income to fall to $2.2 billion from $5.51 billion in the period a year earlier as it books losses on loans related to leveraged buyouts, weak fixed-income trading results and the deterioration of complex mortgage-backed securities that contained bad subprime loans. It also said its consumer business would be hurt by higher credit costs.

NVDL: The housing bubble has been forgotten, but it is a dragon that is going to incinerate the world economy. The banks are starting to burn...

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