Tuesday, May 7, 2013

Bank of America says it has 'substantially fulfilled' settlement relief

Bank of America believes it has "substantially fulfilled" its requirements to reduce principal, lower interest rates and otherwise help homeowners as part of the large-scale mortgage servicing settlement last year, the Charlotte bank said in a quarterly securities filing Tuesday.

The bank had been required to pay a total of  $11.8 billion, including cash payments to regulators and mortgage relief directly to borrowers -- the most of any of the five banks in the $25 billion settlement.

Settlement monitor Joseph Smith, a former N.C. banking commissioner, must certify banks' completion of their requirements. He's already done so for Ally Financial, which had the smallest portion of the settlement.

Bank of America was not immediately available for comment.

The bank did not provide a final breakdown of where relief went in its securities filing, which cites activity through March 31.

Smith's latest published report, which covered relief through Dec. 31, said Bank of America had reported a total of $26.8 billion in relief. Not every form of mortgage help receives dollar-for-dollar credit under the settlement.

In the filing, Bank of America also notes that it may be subject to more scrutiny and litigation related to its mortgage servicing. On Monday, New York Attorney General Eric Schneiderman announced his office would sue Bank of America and Wells Fargo over alleged violations of the settlement's new servicing rules.

Update: According to a statement from Smith's office, Bank of America, Wells Fargo, Citigroup and JPMorgan Chase have all asked for a review of their progress so far. That will be released "in the coming weeks," Smith said in a statement. The next public report will be May 14.