It’s a new year, and Bank of America is moving quickly to put to bed ongoing questions about the mortgage repurchase or “putback” risk that has dogged the stock for the past several months.The bank announced this morning that it will take a $3 billion charge to settle the last of its mortgage putback exposure with the GSEs, Fannie and Freddie.
The stock is rallying on the news.
That being said, this doesn’t end the issues related to other entities, such as the bond insurers, PIMCO, and other owners of private-label mortgages who are also seeking to force the bank to buy back bum mortgages.
But as an indication that the bank is trying to end this now, rather than let this drag out, it’s a good sign.
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