REFILE-UPDATE 1-Subprime sinks Mizuho Securities to $4 bln loss

TOKYO (Reuters) - Mizuho Securities, the unlisted brokerage of Mizuho Financial Group (8411.T), posted on Monday a $4 billion net loss for the year just ended, hurt by bad bets on the U.S. subprime mortgage market.

Mizuho Financial also said it would delay the merger of the brokerage with Shinko Securities Inc (8606.T) until May 2009, as subprime losses continue to weigh on Japan's second-largest bank.

Unlike most Asian rivals, Mizuho has been hard hit by the subprime crisis, having so far lost 565 billion yen ($5.4 billion) on risky investments.

Mizuho took a more aggressive tack than other Asian banks, arranging structured products through its brokerage arm where others in the region limited themselves to investments in such areas.

In 2006 the bank even poached an 11-person structured credit team away from a French rival.

Mizuho Securities reported a net loss of 418.7 billion yen ($4 billion) for the year to March 31, 2008. The brokerage posted a net profit of 27 billion yen a year earlier.

The news is unlikely to jarr investors as Mizuho had already flagged the massive losses at the brokerage when it slashed its annual earnings estimates for a third time this month.

The bank also said it would delay the brokerage merger until May 7, 2009.

Unlisted Mizuho Securities was originally scheduled to merge with affiliate Shinko in January 2008. The deal was later pushed back to May, and then to an unspecified date in 2009, as subprime losses at Mizuho swelled.

($1=104.41 Yen)

(Reporting by David Dolan; Editing by Rodney Joyce)