Bank of America to Pay $9.5 Billion to Resolve FHFA Claims

Company Says Settlement Would Trim Profit by About $3.7 Billion Before Taxes

By JOHN KELL

March 26, 2014 5:01 p.m. ET

Bank of America Corp. BAC -0.17% on Wednesday said it would pay about $9.5 billion to settle all litigation by a top U.S. federal regulator over mortgage securities sold to Fannie Mae and Freddie Mac.

The second-largest U.S. lender by assets warned the settlement would trim first-quarter profit by about $3.7 billion before taxes, or 21 cents a share after tax.

The Federal Housing Finance Agency, which controls the government-backed mortgage giants, sued Bank of America and 17 other financial institutions in 2011 seeking unspecified damages on about $200 billion of mortgage-backed securities.

Write to John Kell at john.kell@wsj.com

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