b. The ratio for the allowance for loan losses to end-of-period loans excludes the following: loans accounted for at fair value and loans held-for-sale; purchased credit-impaired loans; the allowance for loan losses related to purchased credit-impaired loans; and, loans from the Washington Mutual Master Trust, which were consolidated on the Firm's balance sheet at fair value during the second quarter of 2009. Additionally, Real Estate Portfolios net charge-off rates exclude the impact of purchased credit-impaired loans. The allowance for loan losses related to the purchased credit-impaired portfolio was $2.8 billion, $2.8 billion and $1.1 billion at September 30, 2010, June 30, 2010, and September 30, 2009, respectively.
(a) On September 25, 2008, JPMorgan Chase acquired the banking
operations of Washington Mutual Bank. The acquisition resulted in
negative goodwill, and accordingly, the Firm recognized an
extraordinary gain. A preliminary gain of $1.9 billion was
recognized at December 31, 2008. The final total extraordinary gain
that resulted from the Washington Mutual transaction was $2.0
billion. For the third quarter of 2009, and based on income before
extraordinary gain, return on common equity remained at 9%, return
on tangible common equity was 13% and return on assets was 0.70%.