By Dena Aubin and Al Yoon
NEW YORK (Reuters) - Bear Stearns Cos. (BSC.N: Quote, Profile , Research) on Friday said it is weathering the worst storm in financial markets in more than 20 years after a major rating company warned mortgage credit problems could hurt the investment bank's profits.
Bear Stearns' chief financial officer said the shockwaves hitting lending markets, triggered by rising mortgage losses, were as bad as crises such as the Internet bubble bursting in 2001 or the 1998 collapse of hedge fund Long-Term Capital Management.
"These times are pretty significant in the fixed-income market," CFO Sam Molinaro said on a conference call with analysts. "It's as been as bad as I've seen it in 22 years. The fixed-income market environment we've seen in the last eight weeks has been pretty extreme."
Molinaro's dire assessment of the market rocked stocks, bonds and currencies on Friday afternoon. U.S. government bonds surged as investors sought the safety of taxpayer-backed debt and stock indexes fell more than 2 percent. The dollar tumbled against other major currencies.
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