Nov. 10 (Bloomberg) -- Dresdner Bank, the lender being sold by Allianz SE to Commerzbank AG, said 650 million euros ($835 million) of asset writedowns contributed to a third-quarter loss.

Dresdner marked down securities including collateralized debt obligations and U.S. residential mortgage-backed bonds in the third quarter, Munich-based Allianz said in a presentation on its Web site today. The bank had an operating loss of 835 million euros in the quarter after an operating profit of 87 million euros a year ago, Allianz said on Nov. 7.

``Dresdner's funding is secured, it has a sound liquidity profile and its capitalization is on a competitive level,'' Allianz Chief Financial Officer Helmut Perlet told reporters on a conference call today. ``Out of today's perspective there is no need to ask for capital or guarantees from the German government's rescue plan.''

Dresdner's Tier 1 ratio, a key indicator of financial health, fell to 8.1 percent from 9.3 percent during the quarter ending September, Allianz said. Banks typically try to keep core capital ratios to more than 6 percent because lower levels make it difficult to maintain credit ratings and funding costs.

Dresdner's total writedowns related to the credit crunch of 909 million euros also include 105 million euros on commitments to fund leveraged buyouts and 148 million euros related to structured investment vehicle K2 Corp. The lender wrote down a total of 530 million euros in the second-quarter, including 286 million euros on asset-backed securities.

Allianz Scraps Target

Banks worldwide posted about $696 billion in writedowns and credit losses since the start of last year as the worst U.S. housing slump since the Great Depression battered credit markets, data compiled by Bloomberg show.

The reclassification of assets led to a gain of 415 million euros, Dresdner said in a separate statement today.

Allianz, Europe's second-largest insurer by market value, reported a 2 billion-euro third-quarter net loss on Nov. 7. The insurer abandoned its operating profit target for 2008 and said it may miss the goal in 2009 as well.

Allianz, led by Chief Executive Officer Michael Diekmann, agreed on Aug. 31 to sell Dresdner to Frankfurt-based Commerzbank for cash and stock in two steps. Commerzbank will initially acquire 60.2 percent before year-end and buy the remainder by the end of 2009 with new shares stemming from a capital increase.

Allianz CFO Perlet reiterated that the sale of Dresdner is on track.

Dresdner's net loss widened to 2.78 billion euros in the quarter from a loss of 52 million euros a year ago following ``transaction-based impairments'' of 1.41 billion euros.

To contact the reporter on this story: Oliver Suess in Munich at osuess@bloomberg.net

Last Updated: November 10, 2008 08:41 EST