Estimated read time: 1-2 minutes
This archived news story is available only for your personal, non-commercial use. Information in the story may be outdated or superseded by additional information. Reading or replaying the story in its archived form does not constitute a republication of the story.
McLEAN, Va. (AP) - Deutsche Bank will pay $1.4 billion euros ($1.92 billion) to settle a mortgage-backed securities dispute with the Federal Housing Finance Agency, on behalf of Fannie Mae and Freddie Mac.
The agency, which oversees the two government-controlled mortgage finance companies, sued 17 financial institutions over their sales of mortgage securities to Fannie and Freddie that soured when the housing market collapsed.
FHFA alleged that between 2005 and 2007 Deutsche Bank did not provide adequate disclosure about some residential mortgage-backed securities sold to Fannie and Freddie.
The agreement announced Friday resolves Deutsche Bank's single largest mortgage-related litigation case. It also includes an agreement to resolve past and future claims that seek Deutsche Bank to repurchase mortgage loans tied to some of the disputed securities.
"This settlement is another important step in our efforts to recover funds for the nation's taxpayers," Freddie Mac CEO Donald H. Layton said in a statement. "We will continue to work with FHFA on resolving the remainder of our legacy repurchase and litigation issues through equitable agreements."
Deutsche Bank has exited the mortgage businesses that gave rise to the claims.
Shares of Deutsche Bank AG added 49 cents to $46.44 by midmorning Friday, in line with broader market movement.
(Copyright 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.)
