Financial Times Summary

Merrill Lynch - Yesterday, Merrill Lynch spoiled investors' appetite for financial stocks with larger-than-expected-writedowns of $9.4bn that underlined banks' continuing struggle to emerge from the credit crunch. In an unusual move, Merrill Lynch waited until after the market closed to report a $4.6bn loss in the second quarter and announce asset sales aimed at raising $8bn in much-needed capital. The performance, which trailed analyst's expectations, brings Merrill's losses for the past four quarters to about $19bn and has left the battered investment bank as one of the biggest casualties of the financial turmoil.

Goldman Sachs - A benchmark auction of distressed debt assets has given investors a gloomy guide to the prospects of recovering cash from the troubled structured investment vehicles that have been at the core of the credit crunch. The assets auctioned from a £3.5bn SIV formerly known as Cheyne Finance this week drew bids that would pay only 44 cents in the dollar if investors opted for a cash exit from the vehicle, it was revealed on Thursday. Under the restructuring, the auction will fund cash payouts for investors who want them. Any unsold assets will be transferred to a new fund set up by Goldman Sachs.

Wachovia - The investigation into the collapsed market for auction-rate securities intensified as regulators began poring over documents at the Missouri headquarters of Wachovia's brokerage affiliate. They were looking for information on Wachovia Securities' sales practises, internal evaluations of the auction-rate securities market and marketing strategies, according to the office of Robin Carnahan, Missouri secretary of state.

JP Morgan - In London, JP Morgan, led by European boss, Bill Winters, has put the "for let" sign over Bear Stearns' offices in Canary Wharf as it proceeds with plans for the integration of the bank's staff. In spite of previous commitments to take the new building, which is being developed by Canary Wharf at 5 Churchill Place, JP Morgan has instructed commercial property agent Knight Frank to find them a tenant to sublet the offices. There will be sighs of relief in the City- JP Morgan bankers had not been looking forward to endless Jubilee line trips to Canary Wharf to see their ex-Bear Stearns colleagues-but finding a new tenant will not be easy given the current letting market.

FSA - A marketmaker is challenging the City watchdog over a £4m fine, the biggest for market abuse yet handed out to a regulated institutions. The Financial Services Authority has levied the penalty on Winterflood, a broker specialised in smaller and mid-market stocks, for having failed to notice warning signs or to query particular trades in Fundamental-E Investments, a computer screen company in 2004.

Barclays - Slightly more than 10% of Barclay's existing shareholders have exercised their right to take part in the bank's £4.5bn capital increase, despite the shares trading below the 282p offer price for most of the past week. M & G- Improvements in corporate governance , and companies' increased awareness of the need to allocate capital more efficiently, are now the main drivers' of M & G's £318m Asian Portfolio Fund.