..............Bank of America and investors led by money-manager BlackRock Inc. (BLK), investment-fund giant Pacific Investment Management Co. and the New York Federal Reserve arrived at their settlement in June. Led by Patrick, the investors looked to recoup some of the billions lost on mortgage-backed securities sold by Countrywide Financial, the mortgage giant Bank of America bought.
The agreement had been viewed by private investors in the mortgage-backed securities world as a first step to reclaiming lost investments from many banks and mortgage lenders after the investments blew up in spectacular fashion when the housing bubble burst.
Since it was announced, however, the settlement has faced a rash of intervention and criticism.
J.P. Morgan said in its most recent quarterly filing that the firm, and its now-owned Washington Mutual, had created $450 billion in residential mortgage-backed securities that were sold to private investors from 2005 to 2008, of which $169 billion remains outstanding.
The bank said demands to repurchase those loans have been "limited" but noted demands could increase. The bank has put aside $3.6 billion to cover repurchase demands, most of which relate to mortgages sold to Fannie Mae and Freddie Mac, which have stricter contracts...............