May 26 news, regulatory documents show that through the use of accounting standards will be acquired by Washington Mutual Inc.'s Bad debts to income, JP Morgan Chase will harvest 29 billion U.S. dollars of windfall.
JP Morgan Chase in September last year to 1.9 billion U.S. dollars acquisition of Washington Mutual Bank, based on the acquisition accounting method, in accordance with the fair value recorded 118.2 billion U.S. dollars, therefore impairment of assets by 25%. However, with the borrower to begin repayment, the loan is expected to generate cash flow after loan impairment charges and the value of differences in accounting can be charged to the income, JP Morgan Chase may have access to 29.1 billion U.S. dollars of pre-tax earnings.
Regulatory documents also show that Wells Fargo Bank, Bank of America and PNC Financial Services Group Inc. Will be the same as taking over Wachovia Wachovia Corp., Countrywide Financial Corp. And National City Corp. And benefit from a similar accounting arrangements will bring a total of 56 billion U.S. dollars of the proceeds.
Faced with the high 25 points in the United States the unemployment rate and rising housing foreclosure rates, banks will be designed to use a standardized accounting provisions of the loan account. Tax consulting firm, president of Robert Willens LLC, the former Lehman Brothers executives, said Robert Willens, through the application of the accounting provisions, the banks will offer mortgages and commercial loans, "the wreckage of" benefit.
May. 26, 2009
