Credit crisis 60 pct done, opacity a problem-Kaufman

By John Parry

NEW YORK, July 16 (Reuters) - The global financial crisis that erupted a year ago may be about 60 percent through, but the write-downs financial institutions yet face will be hefty and hard to spot, Wall Street economist Henry Kaufman said on Wednesday.

"We probably are at least halfway through and perhaps a little bit more, maybe 60 percent, but the 40 percent is still of substantial magnitude and there is still significant opaqueness where those weak assets fully reside," Kaufman said in a telephone interview with Reuters.

Financial institutions' global write-downs and credit losses combined already total more than $400 billion.

Kaufman, who is president of financial consulting firm Henry Kaufman & Co Inc, said the U.S. Treasury and Federal Reserve's plan announced on Sunday to support mortgage finance giants Fannie Mae (FNM.N: Quote, Profile, Research) and Freddie Mac (FRE.N: Quote, Profile, Research) was belated and needs to be set in motion fast. Kaufman hopes to see that happen before the Congress goes on summer recess, he added.

Kaufman does not expect another major investment bank to have to be saved, as occurred when the Fed and JPMorgan Chase (JPM.N: Quote, Profile, Research) stepped in to rescue Bear Stearns in March.

"I think there are bound to be more serious financial problems in smaller financial institutions and in some regional financial institutions," Kaufman said. Some of these are exposed to the real estate market via construction loans, the credit quality of which is deteriorating, he said.

However, "generally speaking, they do not present a systemic risk," he added. (Reporting by John Parry; editing by Gary Crosse)