JPMorgan Chase & Co, after forging a deal with government investigators on mortgage backed securities, it is now undertaking settlement discussions with the purchasers of the very same bonds prior to the 2008 market crash. The purchasers, according to a Wall Street Journal report, includes asset managers BlackRock Inc and Neuberger Berman Group LLC.
The same group had earlier received from Bank of America the settlement amount of USD8,5 billion for similar claims. The JPMorgan claim is hovering round USD5.75 billion.
The settlement negotiations between the government and JPMorgan and the settlement talks between the investor group and the bank are different from one another. The latter though had been on again off again for the better part of the year, but since the tentative agreement with the government came to light, the discussions for the payment claim had ramped up considerably.
This large settlement amounts are becoming a trend nowadays. According to a 2012 analysi by Compass Point Research & Trading LLC, eleven of the top US banks face losses amounting to USD29.7 billion from claims from provate investors and government supported agencies as a result of the MBS issues. The majority of the claims would come from private investment fund managers.
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