NEW YORK (Bloomberg) - Goldman Sachs Group Inc. CEO Lloyd Blankfein said the credit-market contraction that started with sub-prime mortgages is at least halfway over.

"We're not in the ninth inning by any means, we're maybe two-thirds through, a half to two-thirds," Mr. Blankfein, 53, said yesterday in an interview. "I think it will consume our attention for the rest of this year."

Goldman, the biggest securities firm by market value, posted record profit last year, avoiding writedowns that caused historic losses at Merrill Lynch & Co. and Citigroup Inc. Banks and brokerages have recorded more than $180 billion in asset writedowns and credit losses since the beginning of 2007 on securities and loans tied to sub-prime mortgages. The losses have spread to leveraged loans, commercial real estate and municipal bonds as US economic growth slows.

"It's going to be difficult, there's going to be stress and pain, not just for Wall Street but more importantly for citizens, but it is being worked through," Mr. Blankfein said. "The signs of it are all the attention, the writedowns, the fact that assets are being disposed of" and sold to "more patient capital".

The current market decline "feels broader and longer and more severe" than previous declines in his career, Mr. Blankfein said. "But I caution that almost any crisis that's been resolved feels like a lesser crisis than any one that's unresolved."

Mr. Blankfein, who was paid a record $67.9 million bonus for 2007, warned at a conference on June 27 that the biggest risk he saw to the markets and the economy would be "a very big crisis in the credit markets that would have a very wide effect on the credit markets". He noted at the time that low interest rates and narrow credit spreads had driven a lot of wealth creation in the last five years in areas such as real estate, private equity and emerging markets.

Goldman is scheduled to report fiscal first-quarter earnings on March 18. Mr. Blankfein was speaking today on the sidelines of a press conference for a new, Goldman-backed effort to provide business education to women in developing countries.