JPMorgan Chase & Co. could reveal a $2.1 billion capital markets writedown, and Bank of America Corp. could reveal a writedown of roughly $1 billion, when they report their third-quarter earnings, an analyst wrote Friday.
In his report, Howard K. Mason of AllianceBernstein LP's Sanford C. Bernstein & Co. LLC cited Citigroup Inc.'s announcement last week that it would report a 60% third-quarter earnings decline from a year earlier because of the recent market turmoil and deteriorating credit quality.
Mr. Mason wrote that expects only a "slight deterioration" of consumer and commercial loans for JPMorgan Chase and B of A, though the Federal Reserve Board's interest rate cut likely hurt both company's net interest margins, because the yield curve for short-terms swaps inverted.
B of A's investment in China Construction Bank somewhat offset the Charlotte company's decline in its equity investment portfolio, he wrote.
