Nov. 7 (Bloomberg) -- Banks may be forced to write down $64 billion because of falling prices on collateralized debt obligations backed by subprime assets, Citigroup Inc. analysts said.

Wall Street has marked down prices of the asset-backed securities by about $15 billion so far, analysts led by Matt King in London wrote in a report e-mailed today. The data excludes Citigroup's own projected writedowns of as much as $11 billion announced this week.

``Of the many skeletons hiding in the subprime closet, writedowns on banks' positions on CDOs of ABS are probably the scariest,'' King wrote.

Investor concern that banks face more losses from the worst U.S. housing market in 16 years pushed shares of Citigroup to the lowest in more than four years. Royal Bank of Scotland Group Plc analysts today predicted banks may writedown between $250 billion and $500 billion because of the credit slump.

Merrill Lynch & Co. reported a $7.9 billion writedown on subprime-related securities last month, triggering the ouster of Chief Executive Officer Stan O'Neal. The New York-based brokerage wrote down a further $500 million of leveraged loans.

``Was Merrill massively more exposed than everyone else, or have other banks yet to face up to reality?'' the report said.

Citigroup, Merrill and Zurich-based UBS AG account for about 95 percent of the $25.3 billion of writedowns on all structured credit products including CDOs of asset-backed securities, according to Lehman Brothers Holdings Inc. data. Total losses from the collapse of the U.S. subprime mortgage market could be as much as $250 billion over the next five years, Lehman said.

To contact the reporter on this story: Hamish Risk in London hrisk@bloomberg.net

Last Updated: November 7, 2007 13:51 EST