KKR Financial, which invests in high-yield corporate bonds and other debt-related securities, said it will not pay a dividend for the period, and does not expect to make any distributions during 2009.

The fund said it lost $1.18 billion, or $7.85 per share, in the quarter ended Dec. 31, compared with net income of $59.9 million, or 52 cents per share, in the year-earlier period. The per-share results reflect a 30 percent increase in the number of outstanding shares in the most recent quarter.

The results included an impairment charge of $454.3 million for its securities available for sale portfolio, which consists mainly of high-yield debt securities.

They also reflect a write-down of $137.3 million of certain corporate loans the company designated as held for sale and losses of $156.3 million on sales of assets during the quarter. Of that $156.3 million in realized losses, $137.5 million relates to assets held by Wayzata Funding LLC, the company's collateralized loan obligation transaction. The deterioration of the corporate loan market last fall led to KKR pouring more money in. An amendment in January means no more collateral is needed to back Wayzata, but the company cannot say at this time if it will receive any return from the investment.

KKR Financial said it increased its provision for loan losses, or money set aside to cover souring loans, to $471.5 million, from $25 million a year earlier.

Charge-offs, or loans written off as unpaid, totaled $25.7 million.

For the year, KKR Financial said it lost $1.08 billion, or $7.68 per share, compared with a loss of $100.2 million, or $1.11 per share, in 2007.

KKR shares fell 30 cents, or 28 percent, to 77 cents in late afternoon trading.