I was reading a report that said that certain bank’s tangible book values are supported by large deferred tax assets. It went on to say that banks avoided DTA writedowns at 2009 year-end based on incorporating several years of future profitability in their assessment. First question: how can this be the case that they can project future profits.. seems suspicious to me.

Anyway, does anybody know where those DTA’s are from? From writedowns of loans that tax does not allow (as tax requires full writeoff to get a deduction)?

Who studies banks and taxes?