HONG KONG (MarketWatch) -- The Bank of China is expected to announce a large fourth-quarter write-down on investments backed by U.S. sub-prime mortgages when it releases full-year results in April, according to a published report Monday.

The Bank of China (3988) BACHF, +3.12% , one of China's big four state-owned banks, is expected to lower the estimated value on $7.95 billion in subprime-backed securities and set aside additional funds to cover potential losses, the English-language South China Morning Post reported without citing its source.

The revision comes after a sharp downturn in financial markets in the September-to-December quarter that eroded the value of its subprime portfolio. To cover the losses, the bank likely will need to set aside an additional $300 million, according to BNP Paribas estimates.

In August, the bank revealed it had $9.65 billion in subprime securities, the most of any Asian financial institution. In September, the bank set aside $322 million to account for potential losses on the investments.

Shares of Bank of China were down 3.9% in early Monday trading in Hong Kong.