Credit market writedowns not over yet

according to Yalman Onaran (via Eddy Elfenbein):

Banks and securities firms, reeling from record losses resulting from the collapse of the mortgage securities market, are failing to acknowledge in their income statements at least $35 billion of additional writedowns included in their balance sheets, regulatory filings show.

Citigroup Inc. subtracted $2 billion from equity for the declining value of home-loan bonds in its quarterly report to the Securities and Exchange Commission on May 2 without mentioning the deduction in the earnings statement or conference call with investors that followed.

The balance-sheet adjustments are in addition to $344 billion of writedowns and credit losses already reported on the income statements of more than 100 banks. These companies have raised $263 billion from sovereign wealth funds, their own governments and public investors to shore up capital. The balance-sheet writedowns also reduce equity, which needs to be replenished. Adding the $35 billion leaves the banks with a $116 billion mountain of losses to climb.

"The smart people are the ones who've identified the problems, put them out there in full transparency, and addressed them by raising more capital," said Michael Holland, who oversees more than $4 billion as chairman of Holland & Co. in New York. "There is still billions of dollars of crap out there that hasn't worked itself through the system. Banks need more capital to work that all out."

Sounds like seventh inning to me.