Monday, August 08, 2011

BofA liabilities bigger than expected

Bank of America Bank of America told investors that its liabilities for mortgage repurchases from Fannie Mae Fannie Mae and Freddie Mac Freddie Mac could be worse than expected as the two companies become “more rigid” in dealing with the bank.

Fannie and Freddie are sending back to the bank many more faulty loans than BofA had anticipated.

And the stakes are high. The bank said in a filing this week with the Securities and Exchange Commission that the “ultimate resolution” of its housing-market liabilities “could have a material adverse effect on our cash flows, financial condition and results of operations.”


We will start seeing the magnitude of the problem with BofA numbers.

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