The mortgage loans Wells Fargo extended after 2008 "have virtually no losses," CFO Sloan said. Reserve releases were an important contributor to banks' strong second-quarter results. They accounted for 14 percent of JPMorgan's second-quarter earnings, 6 percent of Wells Fargo's and 16 percent of Bank of America's, according to a September report from Bernstein Research. However, reserve releases can offset lower revenue for only so long before banks have to find ways to make up the difference, NAB's Bush said. "The industry is in this transition period, but transitioning into what? You hope it's into better growth, better margins, and all the stuff that goes into that, but it doesn't feel that way yet." JPMorgan, Wells Fargo and Bank of America will report third-quarter earnings in mid-October. (Editing by Dan Wilchins and Matthew Lewis)