The U.S. government has reached "agreement in principle" to the settlement of its Swiss banking giant UBS AG, to cover the mortgage-backed securities losses of more than $ 90 billion lawsuit, the bank announced Monday.
2011, the U.S. government sued UBS sold approximately $ 19.6 billion worth of housing finance institutions Fannie Mae (Fannie Mae) and Freddie (Freddie Mac) mortgage-backed securities and other 17 financial companies. However, the securities become toxic when the housing market collapsed.
In the lawsuit against Bank of America is a major American company, Citigroup, JP Morgan Chase, Goldman Sachs, but the bank's actions to expand to other major European banks, including Royal Bank of Scotland, Barclays Bank and Credit Suisse (Credit Suisse).
Fannie Mae (Fannie Mae) and Freddie Mac, which is determined by the Federal Housing Finance Agency's supervision, the purchase of mortgage loans, securities issued by banks, so that lenders use the money to re-invest in the real estate market. Invested heavily in the two agency residential mortgage-backed securities, including mortgage loans bundled into complex investment pool after the collapse of the real estate bust, helping fuel the financial crisis in late 2008.
UBS released no more details or settlement costs, it says "still needs final approval by the parties."
Swiss banking giant Monday also announced that in the second quarter of this year, its net profit rose 62 percent 690 million francs ($ 734 million), and from a year earlier to 4.25 million francs. UBS said progress is being made, its strategic overhaul.
However, the second-quarter improvement is still way down reports, headquartered in Zurich, banks over the same period in 2011 to 1.02 billion Swiss francs. Basic results released unexpectedly, a week ahead of a planned second-quarter report.
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