Wall Street Journal: Bank of America Corp. is apparently swithing strategies. It has been reported by people familiar with the situation that BAC has begun potential settlement discussions with some of its largest mortgage investors. CEO Brian Moynihan had pledged in November to engage in “day-to-day, hand-to-hand combat” on investor requests to repurchase flawed mortgages made before the U.S. housing collapse. The group discussing a possible settlement with the nation’s largest bank as measured by assets includes the Federal Reserve Bank of New York, government-owned mortgage company Freddie Mac, BlackRock Inc. and Allianz SE‘s Pacific Investment Management Co., or Pimco, a unit of Allianz SE.
The investors, some of whom are acting on behalf of clients, sent a letter in October alleging that a Bank of America unit didn’t properly service 115 bond deals comprised of residential mortgages. It gave the bank 60 days to respond. Read more…..