US: Subprime crisis deepens

Lehman brothers is to fold its subprime business - and other companies are either doing the same, or making large cuts in the workforce as the subprime crisis begins to bite.

Companies are losing access to credit and turning to fall-back plans. And some have gone into liquidation.

Here's a roll-call of yesterday's bad news.

Accredited - still trying to force private equity fund Lone Star Funds to complete a USD400m purchase of the company based on its 2006 performance (loans made exceeded USD15 milliard) will cut more than half of its existing 2600 workforce in the next week and close itself to new business. It had more than 5,000 workers at the beginning of 2007.

H&R Block's Block FInancial has had to dip into bank facilities after it found cashflow support difficult to raise.

HSBC is to close an office in Indiana making 600 redundant.

Delta Financial in New York told 300 people to go.

Amstar Financial Holdings in Houston Texas announced that it is closing its mortgage unit and selling the branch network to The Money Store.

Lehman Brothers is to close BNC Mortgages in Irvine, California - making 1200 jobless. That's going to cost the bank USD52 million in charges. But it will not exit the business completely - it still has Aurora Loan Services.

First Magnus Financial Corporation (Arizona) and Quality Home Loans (California) announced that they were entering into liquidation.