Hypo Real Estate expects 3.1B euro 3Q pretax loss

FRANKFURT — Hypo Real Estate Holding AG, the commercial lender that got a 50 billion euro bailout from the German government last month, said Wednesday it expects to report a third-quarter pretax loss of 3.1 billion euros ($3.9 billion) because of more write-downs at its Irish bank.

The Munich-based company said the anticipated loss includes some 2.5 billion euros ($3.2 billion) in write-downs on its stake in the Irish bank Depfa Bank PLC, which it bought in 2007 for 5.3 billion euros.

It pushed back the release of its third-quarter earnings from Wednesday to Nov. 17.

Hypo also said that it had another 600 million euros ($762 million) in write-downs related to the bankruptcy of Lehman Brothers Holdings Inc., Iceland's financial meltdown and a loss on its investment in Babcock & Brown Ltd.

Hypo Real Estate said it expected more "negative impacts" on its fourth-quarter earnings and into 2009 because of the market uncertainty worldwide and the costs of its 50 billion euro ($63.5 billion) government bailout, which has been finalized and will take effect this week.

"Overall, the market environment remains difficult," it said.

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