Citigroup to pay $1.13 bn to settle residential mortgage claims
08 Apr 2014
Citigroup Inc today agreed to pay $1.13 billion to settle claims by investors who had demanded that it buy back billions in residential mortgage-backed securities sold before the global financial crisis.
The New York-based financial firm said it reached an agreement with 18 institutional investors covering 68 securitisation trusts that issued a combined $59.4 billion in home loans from 2005 to 2008.
The settlement has to be approved by the US Federal Housing Finance Agency, trustees of the 68 trusts, and the court.
The 18 institutional investors, include affiliates of BlackRock, Goldman Sachs, and Pacific Investment Management Co among others, were represented by Houston law firm Gibbs Bruns, which had earlier concluded similar settlements with JPMorgan Chase and Bank of America.
'This settlement resolves a significant legacy issue from the financial crisis and we are pleased to put it behind us,' Citi said in a statement.
The settlement offer would release Citi from having to buy back mortgages sold to the trusts, but does not cover home loans sold through private-label securitisation trusts via Citi's consumer mortgage business.
.webp)
.webp)
