Credit Suisse Warns of $380 Million Fourth-Quarter Legal Hit (3)

Credit Suisse Group AG signaled a $380 million fourth-quarter hit related to a long-standing legal case surrounding residential mortgage-backed securities, adding to the bank’s woes after it wrote down its stake in hedge fund <-bsp-bb-link state="{"bbHref":"bbg://securities/669487Z%20US%20Equity","_id":"00000176-1ed6-dc08-ab76-dff6de490000","_type":"0000016b-944a-dc2b-ab6b-d57ba1cc0000"}">York Capital Management.

The Zurich-based lender is facing costs of as much as $680 million after the New York judge presiding over the case ordered the bank and municipal-bond insurer MBIA to submit estimates of damages related to the mortgages, issued in 2007, Credit Suisse said in a statement on Tuesday. It has already set aside $300 million to cover losses in the case.

Thomas Gottstein

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