Reuters reports that Goldman Sachs analyst William Tanona has said that Citi may writedown as much as $9bn in the second-quarter, forcing the company to raise additional capital and cut its dividend.

Tanona said in a research note published this week that 'the turnaround in business trends that we had been expecting in the second half of 2008 may not occur as quickly as we should have thought. We see multiple headwinds for Citigroup....Given the firm's current level of earnings power, we do not believe the dividend is safe. We believe any additional capital raises will be in the form of common equity, dividend cuts and or additional asset sales'.

The Wall Street Journal reports that, according to an unnamed 'person familiar with the situation', Merrill Lynch has started laying off staff in its Australian investment banking unit. The cuts, which are said to be part of a general rationalization of the business, are thought to be in the single digits, but come in a region that has remained relatively immune to staff cutbacks.

Bloomberg reports that Fortis announced Thursday a $12.54bn solvency plan, which includes the raising of $2.4bn in additional equity. The firm will also cancel its interim dividend, and sell and lease back real estate and sell non-core assets. CEO Jean-Paul Votron said in a statement that 'we believe that 2008 will be a difficult year for our industry, and we do not expect an improvement in the economic environment soon. The measures announced today will help Fortis navigate through the current challenging market circumstances'.

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