Takefuji Corp., the nation's third-largest consumer lender by market value, said Monday it has cut its full-year profit forecast 69 percent, citing subprime-related losses.

Net income in the year ending March 31 may total ¥13.6 billion, compared with a previous forecast of ¥43.3 billion, the Tokyo-based lender said in a statement to the Tokyo Stock Exchange.

Takefuji will book a ¥29.7 billion charge related to derivatives transactions arranged by Merrill Lynch & Co., it said in the statement.

The lender said earlier this month it might cut its forecast due to the charges, becoming the first Japanese consumer lender struck by the global credit-market rout.

Credit-default swaps used to speculate on shifts in the company's ability to repay debt rose about 55 basis points to 455 basis points, UBS AG prices show. An rise in the price indicates deteriorating investor perceptions of credit quality.

Takefuji removed ¥30 billion in 20-year bonds, carrying a coupon rate of 4 percent, from its balance sheet through transactions set up last May by Merrill Lynch Japan Securities Co. Takefuji traded in securities linked to credit-default swap indexes based on U.S. and European companies and AAA-level bonds.

Takefuji fell 6 percent to close at ¥2,050 on the Tokyo Stock Exchange before Monday's announcement, bringing its decline to 18 percent since it revealed the loss on March 3.

Japan's financial firms booked ¥600 billion in subprime-related losses in the nine months to Dec. 31.