JPMorgan, feds arrive at $13B deal in MBS clash

November 19, 2013 04:30 PM

From left: JPMorgan CEO Jaime Dimon and Attorney General Eric Holder

From the New York site: JPMorgan Chase has agreed to terms of a $13 billion settlement with federal and state regulators over the bank’s sale of toxic mortgage-backed securities. The agreement, which is expected to be announced today, includes compensatory payments of $7 billion, a fine of $2 billion, and $4 billion in aid to distressed homeowners.

JPMorgan’s CEO Jamie Dimon will hire an outside monitor to oversee the distribution of the funds to homeowners. The sticking point of the deal was the amount of aid slated for these homeowners, and the U.S. Department of Justice asked the U.S. Department of Housing and Urban Development for help in the final round of talks with the bank, the Wall Street Journal reported.

About half of the aid will fund measures such as originating new mortgages for low- and moderate-income borrowers and absorbing the remaining principal owed on vacant properties that are yet to be foreclosed on, sources told the Journal. [WSJ]  – Hiten Samtani

Related Article


Banks see uptick in mortgages, but remain wary ahead of potential Fed interest rate cut

Chase branch at 6916 Collins Avenue with Roberto Susi and Jose Sasson of Axiom Capital Advisors

If you can’t beat ‘em, join ‘em: JP Morgan buys North Beach branch

We Company seeks $2.75B credit line ahead of IPO

JPMorgan is latest bank to shrink its mortgage division with 400 layoffs