Bank of America Near $16 Billion Settlement (Mercado de Dinero)

Jueves, Agosto 7 2014 12:29 | Escrito por Redacción

The Department of Justice and Bank of America have reached a record settlement in principle in which the bank will pay just under $17 billion to resolve allegations related to fraudulent marketing of mortgage-backed securities that helped cause the nation’s economic crisis, an official with knowledge of the negotiations said Wednesday.

The bank has agreed to pay roughly $9 billion in cash to the federal government, states and other government entities, these people said, as part of an overall pact that could be finalized this month. Additional money would be aimed at consumer relief, such as reducing mortgage balances for struggling homeowners, according to The Wall Street Journal.

Eric Holder, Attorney General.

The tentative deal, reached July 30 during a night telephone conversation between Attorney General Eric Holder and Brian Moynihan, CEO of the nation’s second-largest bank, surpasses a similar $13 billion settlement with JPMorgan Chase last November, said the official, who is not authorized to comment publicly.

If finalized, the agreement would set a record for fines and damages in a civil settlement between the U.S. government and a company. It would eclipse a $13 billion deal struck less than nine months ago between the Justice Department and J.P. Morgan Chase JPM -0.48%  & Co. over similar issues, alleging the banks knowingly sold investors shoddy mortgages.

Bank of America  Finally Raises Its Dividend

Bank of America announced on Wednesday that its Board of Directors approved an increase in the quarterly common stock dividend to $0.05 per share from $0.01 per share. The dividend is payable September 26 to shareholders of record as of September 5.

This marks the first increase in Bank of America’s quarterly common stock dividend in seven years and reflects the significant progress the company has made to strengthen the balance sheet and build capital and liquidity.