BofA’s $8.5 Million Settlement With Investors Is Delayed

Posted by Patrick Barnard on February 05, 2014 No Comments
Categories : Required Reading

Five days after it was approved, a New York State judge has delayed a final ruling in Bank of America Corp.'s $8.5 billion settlement with mortgage-bond investors, including BlackRock Inc. and Pacific Investment Management Co., after American International Group Inc. (AIG), which led the investors in the suit, objected to the terms of the deal.

New York Supreme Court Justice Saliann Scarpulla, who took over the case from New York State Supreme Court Justice Barbara Kapnick, agreed on Wednesday to delay the Feb. 7 entry of the ruling after objectors argued that Bank of America should be required to repurchase modified loans, if so warranted, Bloomberg News reports.

As per the report, the objectors argued that the loan modification claims are a ‘significant piece’ of the settlement.

Judge Kapnick approved the settlement in Manhattan on Jan. 31 – however she refused to include claims Bank of America was required to repurchase modified loans, saying the trustee, Bank of New York Mellon Corp., failed to properly evaluate them.

According to the report, that left open questions as to how much of the settlement funds will go to the trusts, which trusts are covered by the accord, and how the funds will be divided.

Scarpulla has scheduled a Feb. 19 hearing on the objectors' request.

For more, check out the Bloomberg News report.

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