CHARLOTTE, N.C. — Bank of America says they reached a settlement with U.S. Department of Justice, federal agencies and six states to resolve mortgage-related litigations and investigations Thursday.
The settlement is expected to reduce third quarter pretax earnings by $5.3 billion or $0.43 per share.
The settlement includes releases on the securitization, origination, sale and other specified conduct relating to residential mortgage-backed securities and collateralized debt obligations.
Bank of America says the settlement also includes an origination release on residential mortgage loans sold to Government Sponsored Enterprises and private-label RMBS trusts or guaranteed by the Federal Housing Authority.
Bank of America says they will pay a total of $9.65 billion in cash and provide $7 billion worth of consumer relief.
Chief Executive Officer Brian Moynihan said, “We believe this settlement, which resolves significant mortgage-related exposures, is in the best interests of our shareholders, and allows us to continue to focus on the future.”
Read the full release here.
