JP Morgan Chase 2010 Annual Report Download - page 303

JPMorgan Chase & Co./2010 Annual Report
303
sufficient size to represent a viable offering to clients, enabling
pricing of its shares, and allowing the manager to develop a com-
mercially attractive track record. After these goals are achieved, the
intent is to remove the Firm’s capital from the investment.
Stress testing: A scenario that measures market risk under
unlikely but plausible events in abnormal markets.
TARP: Troubled Asset Relief Program.
Taxable-equivalent basis: Total net revenue for each of the
business segments and the Firm is presented on a tax-equivalent
basis. Accordingly, revenue from tax-exempt securities and invest-
ments that receive tax credits is presented in the managed results
on a basis comparable to fully taxable securities and investments.
This non-GAAP financial measure allows management to assess the
comparability of revenue arising from both taxable and tax-exempt
sources. The corresponding income tax impact related to these
items is recorded within income tax expense.
Troubled debt restructuring (“TDR”): Occurs when the Firm
modifies the original terms of a loan agreement by granting a
concession to a borrower that is experiencing financial difficulty.
Unaudited: Financial statements and information that have not
been subjected to auditing procedures sufficient to permit an
independent certified public accountant to express an opinion.
U.S. GAAP: Accounting principles generally accepted in the United
States of America.
U.S. government and federal agency obligations: Obliga-
tions of the U.S. government or an instrumentality of the U.S.
government whose obligations are fully and explicitly guaranteed
as to the timely payment of principal and interest by the full faith
and credit of the U.S. government.
U.S. government-sponsored enterprise obligations: Obliga-
tions of agencies originally established or chartered by the U.S.
government to serve public purposes as specified by the U.S. Con-
gress; these obligations are not explicitly guaranteed as to the
timely payment of principal and interest by the full faith and credit
of the U.S. government.
U.S. Treasury: U.S. Department of the Treasury.
Value-at-risk (“VaR”): A measure of the dollar amount of poten-
tial loss from adverse market moves in an ordinary market envi-
ronment.
Washington Mutual transaction: On September 25, 2008,
JPMorgan Chase acquired the banking operations of Washington
Mutual Bank (“Washington Mutual”) from the FDIC for $1.9 bil-
lion. The final allocation of the purchase price resulted in the rec-
ognition of negative goodwill and an extraordinary gain of $2.0
billion. For additional information, see Note 2 on pages 166–170
of this Annual Report.