The $8.5 million settlement between Countrywide bond investors and Bank of America (BAC) may provide a boost to the private-label securitization market. However, it does so at the expense of other large issuers in the space, according to one ratings agency insomuch as it may open the door to more legacy residential mortgage-backed securities settlements. On Friday, Fitch Ratings noted the agreement on settling the mortgage repurchase and servicing claims of bond holders may improve some of the risk associated with the market. Analysts at Moody's Investors Service (MCO), like Fitch, also think the agreement may lay a framework for how issues like this may be resolved in the future. However, Moody's notes that while the $8.5 billion seems incredible in lump sum form, it is a blip in the total investor exposure. "Based on our loss projections, we estimate that these payments will cover approximately 9% of each covered trust's total projected loss amount," said analysts in Moody's recent credit market outlook report. "Because loss expectations on the subprime deals are higher than on other RMBS, we estimate that 41% of the settlement will go to the subprime bondholders." Ratings agency DBRS warns further legal challenges are on the horizon. Mortgage servicers still face a state attorneys-general settlement over foreclosure practices, and the lawsuit brought on by the National Credit Union Administration board for failed mortgage investments. Additionally, there are more concerns that continue to drag down mortgage servicing. "The settlement may prove unsettling to other banks; the two most vulnerable are JPMorgan Chase and Wells Fargo, due to their crisis-era acquisitions of Bear Stearns and Wachovia, respectively," said DBRS analysts. "All this will be further exacerbated if American house prices continue to fall." Write to Jacob Gaffney. Follow him on Twitter @jacobgaffney.