Bank of America Agrees to Reimburse Billions... to Corporate Investors
Just when you think the details in the mortgage crisis can't get anymore infuriating. Bank of America has agreed to an $8 billion settlement with a group of super-powerful, high-profile investors who lost funds on securities caught up in the fake mortgage bubble. The Wall Street Journal:
The payment would be the largest such settlement by a financial-services firm to date, exceeding the total profits of the Charlotte, N.C., bank since the onset of the financial crisis in 2008. Bank of America's board approved the settlement during a meeting Tuesday to discuss the matter, one of these people said.
The bank also plans to release preliminary 2nd-quarter earnings on Wednesday, people familiar with the matter said.A settlement would end a nine-month fight with a group of 22 investors who hold mortgage-backed securities originally valued at $105 billion, including the giant money manager BlackRock Inc., the insurer MetLife Inc. and the Federal Reserve Bank of New York.
Hey, at least somebody's getting reimbursed, am I right? Uh, no. While it may be somewhat satisfying to see big banks suffering the consequences of inflating mortgage securities, today HousingWire released a reportthat said as of May, the number of houses about to be foreclosed upon still outnumbers the sale of foreclosed houses by 50 to 1. So as more millionaire investors burned by the housing bubble line up to make their claims against big banks like Chase, Wells Fargo and Goldman Sachs, the question begs: what about the people who lost, and are still losing, their homes?