The JPMorgan Settlement

Following on from our prior RMBS litigation coverage (FHFA RMBS Litigation Totals and A Proliferating "Putback" Problemo) we wanted to add some color to the recent $13bn settlement by JPMorgan.

Initial settlement details:

1. JPMorgan may not pursue indemnification claims from the FDIC for any matters covered by the settlement. 
2. Included in the settlement is the $4 billion FHFA settlement regarding private-label RMBS losses ($1.26 billion to Fannie Mae; $2.74 billion to Freddie Mac). 
3. Previously mentioned $680mm and $480mm rep & warranty settlements with Fannie Mae and Freddie Mac, respectively, are not included in this agreement. (This leaves open the possibility for JPM to claim that the FDIC is responsible for WaMu originations in the rep & warranty settlement.) This could impact the net result of Deutsche Bank National Trust Co. v. Federal Deposit Insurance Corp. et al. 
4. Criminal probe is not closed. 
5. Acknowledgment of misrepresentation, but no explicit admission of wrongdoing.

Our additions are in blue within the table. Sources are at the end.

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http://www.justice.gov/opa/pr/2013/November/13-ag-1237.html http://www.fhfa.gov/webfiles/25649/FHFAJPMorganSettlementAgreement.pdf http://www.justice.gov/iso/opa/resources/61620131119191331856335.pdf http://www.ncua.gov/News/Pages/NW20131119JPMorganChase.aspx http://www.justice.gov/iso/opa/resources/72420131119202254491668.pdf http://www.fdic.gov/news/news/press/2013/pr13103.html http://www.justice.gov/iso/opa/resources/51720131119202421482972.pdf 
https://oag.ca.gov/news/press-releases/attorney-general-kamala-d-harris-announces-300-million-settlement-jp-morgan http://www.businesswire.com/news/sacbee/20131119006821/en http://news.delaware.gov/2013/11/19/biden-secures-nearly-20-million-for-delaware/ 
http://www.chicagobusiness.com/article/20131119/BLOGS02/131119738/illinois-pension-funds-get-100-million-in-chase-settlement# 
 http://www.mass.gov/ago/news-and-updates/press-releases/2013/2013-11-19-jpmorgan-settlement.html http://www.ag.ny.gov/press-release/ag-schneiderman-led-state-federal-working-group-announces-13-billion-settlement http://www.justice.gov/iso/opa/resources/64420131119164759163425.pdf

Californian (Local) Govt. Credit Scoring, Enhanced

Earlier this year, we launched a web site containing financial data and credit scores for 260 California cities. 

Thanks to a recent grant from the Sunlight Foundation, we have extended the site to also cover 55 California counties. The enhanced site is now available at http://www.publicsectorcredit.org/ca. 

The research behind the scoring model can be found at: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2258801. 

It's detailed and colorful. Check it out and tell us what you think!

http://www.publicsectorcredit.org/ca/en/cities

FHFA RMBS Litigation Totals

From complaints (and amended complaints) and settlements we were able to string together this table of potential litigation costs that may be be borne by some of the major financial institutions who sold RMBS securities to FHFA -- based on a basic extrapolation of settlement expenses from the two data points that have been disclosed.  

This covers only RMBS purchase litigation -- not the mortgage repurchases, or "put-backs."  The totals potentially due to FHFA, on behalf of Fannie and Freddie, also ignore any potential settlements the FHFA might strike with other parties which they have not sued, like Wells Fargo. Numbers in the right-hand columns are in billions.