BofA, Citigroup Lose Bid to Dismiss FHFA Mortgage Suits
Bank of America Corp. and Citigroup Inc. (C) are among banks that lost bids to dismiss lawsuits filed by the Federal Housing Finance Agency over mortgage bonds sold to Fannie Mae (FNMA) and Freddie Mac.
U.S. District Judge Denise Cote in Manhattan denied requests by the banks, along with Credit Suisse Group AG (CS) and HSBC Holdings Plc (HSBA), to throw out the cases, according to decisions filed today.
The banks are among more than a dozen financial institutions, including JPMorgan Chase & Co. (JPM), UBS AG (UBSN) and Goldman Sachs Group Inc. (GS), that were sued by the FHFA last year over losses on about $200 billion in mortgage securities sold to mortgage finance companies Fannie Mae and Freddie Mac.
Cote previously ruled that cases against other banks could proceed. In today’s decisions, she said she was adopting the reasoning of the earlier rulings.
Lawrence Grayson, a spokesman for Charlotte, North Carolina-based Bank of America, and Citigroup spokeswoman Danielle Romero-Apsilos declined to comment on the rulings. Representatives of HSBC and Credit Suisse (CSGN) didn’t immediately respond to e-mails seeking comment on the rulings.
The cases are Federal Housing Finance Agency v. Bank of America Corp. (BAC), 11-06195; Federal Housing Finance Agency v. Citigroup Inc., 11-06196; Federal Housing Finance Agency v. Credit Suisse Holdings (USA) Inc., 11-06200; Federal Housing Finance Agency v. HSBC North America Holdings Inc., 11-06189, U.S. District Court, Southern District of New York (Manhattan).