New writedowns said to hit Northern Rock earnings

LONDON (Reuters) - Troubled bank Northern Rock will reveal additional writedowns when it reports its 2007 results on Monday, as loan qualities continue to deteriorate, newspapers reported on Sunday.

The Sunday Telegraph said the bank, which was nationalised last month to prevent it from collapse, has had to nearly double an initial writedown on bad loans taken in December of 118 million pounds.

The newspaper added that the bank's 167 million pound US Collateralised Debt Obligation (CDO) portfolio was virtually worthless because of deteriorating economic conditions. CDOs are packages of loans sold to investors.

The Sunday Times said Northern Rock would post a loss for 2007, and that arrears on the bank's mortgage book climbed almost 20 percent between January and February, citing data filed by Northern Rock's Granite securitisation vehicle

No one was available for comment at Northern Rock.

(Reporting by Tom Bergin; editing by Sue Thomas)