Standard & Poor's has cut Bear Stearns' credit rating after the beleaguered bank's chief operating officer and chief financial officer warned it will make a loss in the fourth quarter - its first for 83 years. The bank is writing down a further $1.2bn (€816m) as a result of soured investments in mortgage-related securities.

S&P cut Bear's rating by one notch to single-A and left the outlook negative, saying: "The expected net loss brings to light the extent to which the company is concentrated in fixed income business, which we believe is an underlying structural weakness in revenue generation."