National Australia Bank and ANZ are most exposed to further writedowns of sub-prime assets, analysts from UBS and Citigroup have said in reports released yesterday. Citigroup said NAB had A$15 billion worth of conduit assets, with about A$9 billion written directly by the bank. Concern was mounting over A$4.5 billion worth of assets. Citigroup estimated further writedowns of A$500 million to A$1 billion. UBS also estimated another A$450 million of writedowns for NAB, which owns Bank of New Zealand. Citigroup also estimated ANZ had US$11.6 billion worth of credit default swap exposure that could be endangered if a counterparty was downgraded or got into trouble. "We have concerns that in the current environment there is substantial risk of further counterparty credit rating downgrades which could result in further material impairment charges for ANZ," Citigroup wrote. * This item was first published in our subscription newsletter available here.
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