UK banks may be forced into further write downs against the values of some of their high risk loans.

Alliance & Leicester and Royal Bank of Scotland are both set to reveal the extent of their losses this week.

A&L is expected to write off a further £50m against its so-called 'toxic loans' in the first half of next year, on top of the £55m charge announced last week.

The bank issued a trading statement last week outlining the fall in the value of its holdings of structured investment vehicles, collateralised debt obligations and other complex financial instruments.

The bank announced a £40m write-off against SIVs but also revealed that following the charge, the holdings of the instruments were in the books at £346m - £52m more than their current market value of £294m.

RBS is likely to writedown up to £1.9bn, analysts say, on the back of the recent turmoil in the markets.

Sanford Bernstein analyst Antony Broadbent predicted that RBS would announce total writedowns of £1.6bn to £1.9bn for 2007, which included those for ABN Amro.

But RBS writedowns on SIVs are expected to be 'negligible' according to Sanford, since neither RBS nor ABN had material exposure to SIVs.

Further reading:

Fair value triggers panic among Wall Street banks

Dollar Falls as Moody's Prepares Rating Cuts on Subprime Losses