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SEC ends inquiry on Wells Fargo's PCI mortgages

The SEC ended its inquiry of Wells Fargo & Co. purchased credit-impaired mortgages after Wells explained how the company valued and accounted for the portfolio of the loans, The Wall Street Journal reported Dec. 15.

The company disclosed that the PCI mortgages, acquired in connection with the 2008 Wachovia Corp. deal, are carried over at a value of $17.7 billion on Sept. 30, as compared to its value of $20.0 billion on Dec. 31, 2015. The loans were initially carried over at a value of $58.8 billion on Dec. 31, 2008, according to the company's most recent Form 10-Q.

Wells Fargo said the portfolio was affected by strong economic conditions and increasing home prices that made it easier for the borrowers to refinance their mortgages or prepay, the WSJ reported.

The SEC concluded its inquiry on the portfolio in November, according to the report.