JPMorgan Chase disclosed on Wednesday that it faces a criminal and civil probe over whether the bank sold risky mortgage-backed securities to investors before the financial crisis, reports New York Times DealBook.
With everyone hoping for positive GDP growth in Q3 and Goldman Sachs analyst Jan Hatzius now predicting growth at an annual rate of three percent in the second half of the year, the banks, investors, and politicians are all hoping that that nasty problem of foreclosures would just go away already. Unfortunately for everyone – especially the people losing their houses – there’s no reason for it to go away.
The nation's biggest banks could face billions of dollars in claims from investors in mortgage-backed securities. Pension funds, mutual funds and others want the banks to take back bad loans. But investors still face a number of legal obstacles.» E-Mail This » Add to Del.icio.us
(Reuters) - A law firm that reached a major settlement with Bank of America over allegedly defective mortgage bonds said on Wednesday that Wells Fargo and Morgan Stanley failed to perform their duties servicing $73 billion in securities. The move likely means bond investors represented by the Gibbs & Bruns law firm could be seeking to negotiate settlements with the two U.S. banks over securities backed by now-soured mortgages made during the housing boom, said Isaac Gradman, an attorney who specializes in mortgage-backed securities. ...
The Spanish banking system is in far worse shape than most realize because of unrealized losses related to Spain's imploded housing bubble. Various austerity measures and tax hikes to bail out French and German banks will greatly exacerbate this problem.
Please consider Spain Banks Face 43% Price Fall on Repossessed Homes