NCUA Reportedly Inks JP Morgan Settlement
The NCUA would not confirm an Oct. 21 report that it has agreed to a tentative settlement with JP Morgan over mortgage-backed securities sold to failed corporate credit unions. The NCUA filed suit against JP Morgan Securities in June 2011, seeking to recover more than $800 million in losses to corporate credit unions.
Public Affairs Specialist John Fairbanks would not verify the accuracy of the report published Oct. 19 in the Wall Street Journal, nor would he provide any details.
According to the report, the agreement is separate from a $13 billion settlement announced Oct. 21 that had been reached between JP Morgan and the Justice Department.
In August, the NCUA won a big victory against JP Morgan and 10 other big bank defendants when the U.S. 10th Circuit Court of Appeals in Denver affirmed a federal ruling in Kansas that said a federal extender statute allowed the NCUA more time to file its suits.
The bank defendants had argued that the NCUA had filed its claims too late.
Any settlement recoveries collected by the NCUA would be applied toward outstanding costs for corporate stabilization and could reduce the amount federally insured credit unions pay in annual corporate assessments.
Settlements totaling $335 million already have been reached with Bank of America, Citigroup, Deutsche Bank Securities and HSBC.
The NCUA board will likely announce an estimated assessment range at its November meeting.