They note that delinquent loans do not normally begin to decline until about six months after the end of a recession.

They would then be allowed to use any surplus to recover up to the full amount of some delinquent loans.

Earnings will also be weakened by a rise in delinquent loans to about $1.6 billion, from $900 million at the end of September.

The level of badly delinquent loans remains high, and will cut into bank profits for several more years.

In the third quarter of 2009, there were 278,189 delinquent loans, 80,327 foreclosures.

Its holdings of badly delinquent loans is now $9.64 billion.

Bankers Trust said delinquent loans rose 42 percent over the year, to $1.84 billion.

A delinquent loan is one in which monthly payments are past due for 60 days or more.

A workout on a delinquent loan of this size would generally take several years.

Banks are reluctant to disclose the extent of their delinquent loans.