http://www.rawstory.com/rs/2013/10/...to-settle-residential-mortgage-bond-lawsuits/J.P. Morgan will settle civil lawsuits related to mortgage bond matters with the U.S. Department of Justice for a record $13 billion, sources have told Bloomberg, The Wall Street Journal and other outlets.
In a call last night, U.S. Attorney General Eric Holder and J.P. Morgan negotiators tentatively settled on terms after the bank offered an additional $2 billion, according to reports.
The payout is within the company’s reserves for legal settlements set aside out of profits this year, and represents about 14 of its gross profit over the last year. Notably, the deal does not obviate the continuing criminal investigation into the firm’s mortgage backed securities, which remains unresolved. J.P. Morgan posted a net loss Tuesday for the first time in years, attributing the loss to legal settlement costs. J.P. Morgan recently increased its legal settlement reserve by another $9.2 billion in anticipation of future losses. Together, the increase in reserve and the $13 billion settlement represent what the company might expect to earn in net profit in a decent year.
http://www.bloomberg.com/news/2013-10-19/jpmorgan-said-to-have-reached-13-billion-u-s-accord.html