JPMorgan Chase & Co.'s chief executive, Jamie Dimon, told investors at the beginning of 2011 that potential repurchases of private-label mortgage securities are "not that material" for his bank — an assertion that increasingly appears to be in doubt.
Dimon might not be quite so confident these days. Gibbs & Bruns LLP, the law firm that negotiated an $8.5 billion mortgage repurchase settlement with Bank of America Corp. on behalf of a group of large investors, has announced that it is seeking put-backs on $95 billion in private-label mortgage-backed securities issued by JPMorgan Chase, Washington Mutual Inc. and Bear Stearns. Private-label securities are mortgage-backed securities or other bonds that are created and sold by companies other than government-sponsored entities like Fannie Mae and Freddie Mac.
"Our clients continue to seek a comprehensive solution to the problems of ineligible mortgages in RMBS [residential mortgage-backed securities] pools and deficient servicing of those loans. Today's action is another step toward achieving that goal," said Gibbs & Bruns attorney Kathy Patrick in a press release Friday.
The law firm's clients, which claim to own the requisite 25% of the deals necessary to mount a challenge, have instructed trustees of 243 securitizations to begin seeking loan put-backs. In practice, this would entail stepping aside and allowing the law firm to file suits.
JPMorgan Chase did not respond immediately to a request for comment by American Banker.
No comments:
Post a Comment