Société Générale Agrees to $122M Settlement in RMBS Suit

On February 27, the Federal Housing Finance Agency (FHFA) announced that it reached a settlement with French bank Société Générale of an RMBS suit in the U.S. District Court for the Southern District of New York.  FHFA alleged violations of federal and state securities law in connection with RMBS purchased by Fannie Mae and Freddie Mac in 2006.  The settlement agreement contains no admission of liability or wrongdoing.  Société Générale and four of its subsidiaries will pay $122 million dollars to the agency.   Press Release.

FHFA and Deutsche Bank Reach RMBS Settlement

On December 20, the Federal Housing Finance Agency announced it had reached a settlement for $1.925 billion with Deutsche Bank AG to resolve claims pending in the United States District Court for the Southern District of New York related to the sale of private-label RMBS between 2005 and 2007.  The FHFA asserted claims for violations of federal and state securities laws on the basis of allegedly false and misleading statements and omissions in the registration statements and prospectuses of securities sold to Freddie Mac and Fannie Mae.  Press Release.

PNC Bank and Freddie Mac Reach Settlement Agreement

On December 6, PNC Bank announced an agreement in principle to an $89 million dollar settlement agreement with Freddie Mac resolving outstanding and potential repurchase claims arising out of the sale of some 900,000 loans to Freddie Mac between 2000 and 2008.  The settlement also covers existing and future claims for losses due to denials, rescissions or cancellations of mortgage insurance.  Press Release.

FHFA Increase of Guarantee Fees

On December 9, the FHFA, in connection with its fulfillment of the ‘Strategic Plan for Enterprise Conservatorships,’ directed Fannie Mae and Freddie Mac to raise their guarantee fees in three separate components: (i) increase the base (or ongoing) fee by 10 basis points; (ii) update the upfront grid to better align pricing with the credit risk characteristics of the borrower; and (iii) eliminate the upfront 25 basis point adverse market fee except in the four states where foreclosure carrying costs are more than two standard deviations greater than the national average.  For loans exchanged for MBS, the price changes will be effective starting April 1, 2014.  For loans sold for cash, the price changes will be effective starting March 1, 2014.  FHFA Release.

Freddie Mac and Fifth Third Bancorp Reach Settlement Agreement

On November 25, Fifth Third Bancorp announced a $25 million settlement agreement with Freddie Mac related to mortgages sold by the bank prior to January 1, 2009.  Per the agreement, Fifth Third Bancorp agreed to repurchase all nonconforming loans it sold to Freddie Mac, including those not identified in repurchase demands.  Press Release.

Bank of America Settles RMBS Claims with Freddie Mac

On December 2, Bank of America announced that it settled claims brought by Freddie Mac for $404 million.  The settlement resolves all remaining representations and warranties claims against Bank of America brought by Freddie Mac related to residential mortgage loans sold to the government-controlled company between 2000 and 2009.  The settlement does not cover loan servicing obligations, loans in private label securitizations, or securities and disclosure claimsPress Release.