Friday, April 09, 2010

Major Banks Said to Cover Up Debt Levels - DealBook Blog - NYTimes.com

Window-dressing accounting style:

Major Banks Said to Cover Up Debt Levels - DealBook Blog - NYTimes.com:
"Goldman Sachs, Morgan Stanley, J.P. Morgan Chase, Bank of America and Citigroup are the big names among 18 banks revealed by data from the Federal Reserve Bank of New York to be hiding their risk levels in the past five quarters ....The Federal Reserve’s data shows that, in the middle of successive quarters, when debt levels are not in the public domain, that banks would acknowledge debt levels higher by an average of 42 percent, The Journal says.

“You want your leverage to look better at quarter-end than it actually was during the quarter, to suggest that you’re taking less risk,” William Tanona, a former Goldman analyst and current head of U.S. financials research at Collins Stewart, told The Journal."

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