The quirk in the actual accounting which references exactly what you speak of is the fact that when they take the assets onto their books, they actually record negative goodwill, but it doesn’t really get “impaired,” because they have to net the costs of “maintaining” the gw against it. Maintaining = costs related to wamu/wach integration. So instead of expensing stuff like merger costs, they basically reverse-capitalize it against the negative goodwill booked versus the acquired assets. Kind of like the with imports declining faster than exports and boosting gdp as a double negative. Odd stuff that you almost certainly do not find anywhere else.

I believe other suits have also been filed.

I would add that in most acquisitions, the asset writedowns are not as much because the acquired company is not being bought out of distress. SO these are fairly unique situations in terms of the scale of the writedowns taken.

And as for the accounting, it is the same thing with operating earnings. Companies trash their earnings and throw everything including the kitchen sink into one-time items. So, that when the rebound comes, subsequent quarters look that much better.

And investors fall for this trick time and again.