Big banks draw down loan-loss reserves to bolster earnings

10/26/2010 | Wall Street Journal, The

Big financial institutions increased their earnings in the third quarter by drawing down loan-loss reserves, according to an analysis by Dow Jones Newswires. The 18 largest commercial banks injected $8.1 billion into net income from such reserves. They had set aside money during the worst of the financial crisis and are dipping into it in part because of accounting regulations that require banks to release such reserves when they are no longer needed.

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Wall Street Journal, The

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