Bank of America is closing in on a deal to pay the biggest US banking settlement in history, in a move that could serve as a riposte to European complaints that American watchdogs are unduly targeting their banks.
The company is reportedly set to pay $16.5 billion (£9.8 billion) to resolve investigations into mortgage securities sold in the run-up to the financial crisis.
If confirmed, the settlement would eclipse the $9 billion imposed upon BNP Paribas earlier this year for sanctions busting, which tipped the French bank into its biggest-ever quarterly loss. JP Morgan paid $13 billion to settle similar mortgage-related claims last year.
Citigroup paid $7 billion last month. Bank of America inherited many of the issues through its purchases of Merrill Lynch and Countrywide Financial during the tenure of former chief executive Kenneth Lewis.
His successor, Brian Moynihan, has been working to rid the bank of the mortgage liabilities it was exposed to through the deals. Around $9 billion is expected to be paid in fines and the rest in support to struggling American homeowners, with negotiations said to have heated up in recent days.
The scale of American penalties for European banks has sparked alarm on the Continent. France has led the protests, with backing from Germany and the UK.
independent.co.uk
The company is reportedly set to pay $16.5 billion (£9.8 billion) to resolve investigations into mortgage securities sold in the run-up to the financial crisis.
If confirmed, the settlement would eclipse the $9 billion imposed upon BNP Paribas earlier this year for sanctions busting, which tipped the French bank into its biggest-ever quarterly loss. JP Morgan paid $13 billion to settle similar mortgage-related claims last year.
Citigroup paid $7 billion last month. Bank of America inherited many of the issues through its purchases of Merrill Lynch and Countrywide Financial during the tenure of former chief executive Kenneth Lewis.
His successor, Brian Moynihan, has been working to rid the bank of the mortgage liabilities it was exposed to through the deals. Around $9 billion is expected to be paid in fines and the rest in support to struggling American homeowners, with negotiations said to have heated up in recent days.
The scale of American penalties for European banks has sparked alarm on the Continent. France has led the protests, with backing from Germany and the UK.
independent.co.uk
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