Mortgage Losses Maul Bear

Updated from 8:57 a.m. EST

Bear Stearns(BSC) swung to a much-larger-than-expected fourth-quarter loss exacerbated by an increased writedown on mortgage-related securities.

For the three months ending Nov. 30, the New York investment bank reported a loss of $854 million, or $6.90 a share. That compares with a profit of $563 million, or $4 a share, in the year-earlier period. Bear Stearns reported a revenue loss of $379 million in the quarter.

Analysts were predicting a loss of $1.79 a share in the quarter, according to Thomson Financial.

For the full year, profit fell 89% to $233 million, or $1.52 a share, while revenue dropped 36% to $5.9 billion. Analysts were expecting a profit of $6.69 a share on revenue of $6.95 billion.

Bear Stearns reported writedowns totaling $1.9 billion, $700 million higher than the company originally disclosed in early November, it said.

Following the lead of Morgan Stanley(MS) CEO John Mack on Wednesday, Bear Chairman and CEO James Cayne said members of Bear Stearns' executive committee will not receive bonuses for 2007, due the poor results.

"When Bear Stearns became a public company, consistent with our entrepreneurial roots and to ensure alignment of interests between management and shareholders, we designed our executive compensation programs to pay for performance," Cayne said. "In a year in which we produced unacceptable results, the plans are working as they were designed -- and the members of the executive committee will not receive any bonuses for 2007."