The Wall Street Journal’s Devlin Barrett is reporting part of JP Morgan’s $US13 billion deal with the Justice Department is at risk of collapsing.
Shares were down as much as -0.70%.
“A key sticking point is whether J.P. Morgan or the Federal Deposit Insurance Corp. bears ultimate responsibility for liabilities linked to Washington Mutual which J.P. Morgan acquired during the financial crisis, said people close to the talks. On Sunday night, lawyers for the bank also offered a proposed deal that could give the bank extra legal protection from criminal probes — something the Justice Department leadership isn’t willing to accept, these people said.”
Early reports of the settlement focused on settling issues related to allegedly faulty mortgage backed securities issued by Bear Stearns and Washington Mutual, which JPM purchased at the height of the financial crisis.
But there had also been disagreements about how Justice would move forward on an ongoing criminal investigation into a JP Morgan mortgage unit in California.
Here’s the chart:
More to come…
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