Bloomberg correspondents Dawn Kopecki and Michael J. Moore are reporting JP Morgan (JPM) and Wells Fargo (WFC) were forced by the Office of the Comptroller of the Currency to write down home equity loans.
The information is available in today’s earnings reports.
According to the article, JPMorgan wrote off $825 million in loans in the third quarter, 87% of which were HELOCs.
“The guidance by the Office of the Comptroller of the Currency led Wells Fargo to increase net loan charge-offs by $567 million, which was covered by reserves,” they also write.
JPMorgan’s nonaccrual loans increased $1.7 billion because of the decision. Wells Fargo moved $1.4 billion in loans to nonaccrual status, including $1 billion in first mortgages and $262 million in junior liens, according to the Bloomberg article.
