If a bid is offered and rejected, does that establish the value of that asset for accounting purposes?
A. FDIC staff has noted that if a loan is not in the “held for sale” category, there is no marking to market of the loan’s value. However, for loans that do need to be marked to market, the bid price would provide a data point for the bank to consider along with other relevant information. Banks should consult their accountants about the possible impact of participation in the LLP on asset valuations.
