BofA $8.5 Billion Mortgage-Bond Settlement Delay Bid Rejected
Bank of America Corp.’s $8.5 billion settlement with mortgage-bond investors won’t be delayed after American International Group Inc. (AIG) and other objectors asked for a hearing to address loan modifications excluded from the accord, a state judge ruled.
New York State Supreme Court Justice Barbara Kapnick in Manhattan on Jan. 31 approved most of the bank’s 2011 deal to end claims by investors in more than 500 mortgage-security trusts that the loans backing the bonds didn’t meet promised quality. Kapnick refused to include claims Bank of America was required to repurchase modified loans, saying the trustee, Bank of New York Mellon Corp., failed to properly evaluate them.
Today, Justice Saliann Scarpulla, who took over the case, said she will not delay entry of the settlement, which will be made effective “expeditiously,” she said.
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