That didn't take long.
Just weeks after Wells Fargo
The restatement isn't that big of a deal. Full-year 2008 earnings will be adjusted down to $0.70 per share, rather than the $0.75 per share initially reported. Big deal. Five pennies. For long-term investors, the change is practically immaterial.
Still, the sudden switcheroo underscores why there's so much uncertainty and fear in the bank sector these days: Investors rely on banks to provide a clear and accurate assessment of what assets are worth, yet the banks themselves are struggling to gain clarity on what they own. Investors, rightfully so, are petrified that banks are being overly optimistic with the carrying value of assets. In Wells Fargo's case, the adjustment was due to the "result of credit events after its … announcement of year-end 2008 results." In other words, things got worse. Quickly.
If you're brave enough to dip your toes in bank stocks, Wells is still one of a handful of banks that still resembles, well, a bank. Unlike Citigroup
Maybe that's what scares me. If Wells Fargo -- one of the last respectable banks alive -- is quickly (albeit insignificantly) altering reported results, what other kind of skeletons lie in the closets of really bad banks? I don't even want to think about it. That's why I'm keeping my distance from anything in the financial services sector right now. I think you should, too.
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Fool contributor Morgan Housel doesn't own shares in any of the companies mentioned in this article. JPMorgan Chase is a current and Bank of America is a former Motley Fool Income Investor recommendation. The Motley Fool is investors writing for investors.