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US judge OKs $8.5B Bank of America settlement
US judge approves Bank of America $8.5B settlement of losses from mortgage-backed securities
Associated Press
2014-02-01 03:01 AM

ALBANY, New York (AP) -- A judge has approved the $8.5 billion Bank of America settlement over investor losses from mortgage-backed securities, concluding that trustee Bank of New York Mellon acted reasonably.

Critics of the settlement argued that it represented only a fraction of the losses.

State Supreme Court Justice Barbara Kapnick writes in her ruling Friday that BNY Mellon "did not abuse its discretion" in entering the agreement and "did not act in bad faith."

According to court papers, the claims arose from "a massive collapse in value" of mortgage loans in New York trusts in 2007 and 2008.

The claims were against trust creator Countrywide Financial Corp. and trust servicer Bank of America, which bought Countrywide in 2008.

Bank of America spokesman Lawrence Grayson says they're reviewing the 54-page ruling.

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