MBIA Inc. (MBI) and Bank of America Merrill Lynch agreed to end a lawsuit the bond insurer filed seeking to recover billions of dollars in payouts on credit default swaps sold against collateralized debt obligations that tanked as the mortgage morass unfolded. MBIA alleged BofAML fraudulently obtained insurance on $5.7 billion of mortgage-backed securities by misstating the quality of subprime home loans, as the bank tried to shed nonperforming loans originated in 2006 and 2007. In a court filing with the New York State Supreme Court, the two parties agreed to voluntarily dismiss the complaint, pay their own attorneys fees and not file the suit again. The companies also are tied up in courts with other lawsuits concerning the restructuring of MBIA and insurance claims on soured mortgages. Write to Kerri Panchuk.
MBIA, BofA Merrill Lynch end $5.7 billion credit-default swap lawsuit
Most Popular Articles
Latest Articles
Kristen Sieffert leads the reverse mortgage presence at The Gathering
FOA’s president spoke about bringing reverse mortgages into the mainstream at the event in Scottsdale, Arizona.