Several major banks that completed big deals for falter competitors last year could reap windfalls produced by accounting rules governing how they valued soured loan books they acquired, according to a published report.
can see a $29 billion gain derived from the difference between the value of marked down loans acquired in its September deal for
and the cash flow they're expected to produce going forward, according to
. The report notes that JPMorgan marked down WaMu's $118.2 billion loan book by 25% when it completed the deal for the failed thrift.
Bank of America
PNC Financial Services
also stand to benefit from the accounting rule, due to their respective purchases of
said. The deals can provide a combined $56 billion, the report said.
Purchase accounting rules allowed the banks to mark down loan books to very distressed levels reached amid the worst financial crisis since the Great Depression,
said. But as borrowers pay debts, the banks can recover some of the lost value.
This article was written by a staff member of TheStreet.com.