BofA Reaches $950 Million Deal on FGIC-Backed Bonds
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Bank of America Corp. is paying $950 million to settle claims that its Countrywide unit pooled faulty mortgages into securities that helped hobble Financial Guaranty Insurance Co. and saddled buyers with losses.
The accords resolve outstanding litigation with FGIC, as well as claims and potential claims that the lender is required to repurchase defective home loans backing the bonds because they failed to match their promised quality, Bank of America said today in a statement. The second-largest U.S. lender entered into the deals with FGIC, which guaranteed the debt, and Bank of New York Mellon Corp., the trustee for the securities.