Yes, according to the 8K none of the loans being sold are to be in excess of 60 days past due, so I do agree that they would be currently performing loans.
On the other issue I suspect you read that here:
"(ii) the aggregate gross book value of the Loans, including (to the extent not reflected in such book value) all Loan Interest, minus an aggregate discount equal to 2.0% of the aggregate gross book value of the Loans (other than the GAP Loans), including (to the extent not reflected in such book value) all Loan Interest, and minus $1,750,000 (as a discount in respect of the GAP Loans)"
This is not as extensive if you read the part past the 2% where it says minus 1,750,000 .....
Also keep in mind that a majority of what they are selling is from the UNB aquisition done in August of 2004 at an estimated total cost of 97.3 million. Last year they took a 100% impaired goodwill writeoff of 42.1 million against that very aquisition.
Now their BV may indeed decline after this deal, it wouldn't surprise me at all. But your call of them being underreserved will become a moot point once the additional capital from this sale is received. It could likely be one of the reasons they felt this sale was necessary....to raise capital. Regardless, their BV after this deal is finished should be considerably higher than the current sp indicates.
Final thought..... why buy assets at the value they are being sold at (relatively high) if the institution you're buying from is headed for BK?? The cows are much cheaper bought at auction then from the farmer.