Wells Fargo, JPMorgan Label More Junior Liens as Bad Assets
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Wells Fargo & Co. and JPMorgan Chase & Co. labeled $3.3 billion of junior liens as bad assets after regulators pushed the nation’s biggest banks to rethink the value of second mortgages whose collateral has vanished.
Wells Fargo classified $1.7 billion of junior liens as nonperforming in the quarter, leading to an increase in overall soured loans, and JPMorgan gave that designation to $1.6 billion of such loans, according to their first-quarter presentations today. Both banks cited federal guidance for the change.