by Calculated Risk on 7/03/2008 05:51:00 PM

From Bloomberg: Fed Cuts Bear Stearns Asset Estimate to $28.9 Billion

The Federal Reserve said the portfolio of Bear Stearns Cos. assets it accepted as part of the firm's takeover by JPMorgan Chase & Co. is now worth $28.9 billion, down from the $30 billion estimated in March.

The central bank cut the ``fair value'' of the assets by 3.7 percent as of June 26, the Fed said today in Washington. ... The central bank will provide quarterly updates on the portfolio's value.
...
JPMorgan is absorbing the first $1.15 billion of any losses realized on the holdings.
...
The Fed is valuing the portfolio in accordance with accounting guidelines that call for an estimate based on sales in an ``orderly market,'' rather than a hypothetical forced liquidation.

That is a loss of $1.1 billion for JPMorgan, and there are probably more losses to come - to paid by the Federal Reserve. The market value of these assets was reported as $30 billion on March 14, 2008 by the New York Fed.