Credit Suisse Group AG (CSGN), Switzerland’s second-biggest bank, agreed to pay $885 million to settle lawsuits by the Federal Housing Finance Agency over mortgages sold to Fannie Mae and Freddie Mac.
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Credit Suisse was among 18 lenders sued by the FHFA in 2011 to recoup losses on about $200 billion in mortgage-backed securities sold to the two government-sponsored companies before the financial crisis. Nine companies, including JPMorgan Chase & Co., Deutsche Bank AG and UBS AG (UBSN), have agreed to pay more than $9.2 billion to settle similar lawsuits by FHFA.
“It’s definitely good for Credit Suisse to have this thing out of the way,” said Guido Hoymann, a Frankfurt-based analyst with Bankhaus Metzler.
Chief Executive Officer Brady Dougan in February called mortgage-related litigation one of the bank’s two most important legal issues alongside the U.S. investigation into whether it helped Americans evade taxes. The company said yesterday the agreement with FHFA resolves the largest mortgage-related investor litigation.