Speculation on upcoming bank settlements

Not much news on the bank fiasco front in the last week or so. Here are two articles pondering what settlements are on the horizon.

5/26 – Alison Frankel at Reuters – Forex class action deals may hint banks braced to lose Libor appeal – Citigroup settled up for $394M with private parties over manipulation of forex.

Article points to one settlement I missed:

1/5 – Reuters – JPMorgan settles currency manipulation lawsuit in U.S. – Morgan will settle up with about $100M.

Ms. Frankel’s article says the way the forex case is going, what with the humongous settlement and criminal pleas, may indicate the TBTF banks also have exposure to similar private claims over manipulating Libor. You will need to read the article to see the procedural twists and turns.

My score-at-home spreadsheet shows that makes 5 banks that have settled private suits for about $1,144M total. I think there are another 6 settlements expected.

6/4 – Wall Street Journal – Justice Department Readies New Bank Settlements Another major round of settlements are in the works. Announcements are expected to stretch over several months.

Nine banks are likely to settle up with penalties ranging from a couple hundred million up to a couple billion.

Subject matter of the settlements will be mortgages that went bad during the recession. The settlements will be on top of what the article says has been $37B of settlements so far.

Article says settlements are expected from:

  • Goldman Sachs
  • Morgan Stanley
  • Barclays
  • Credit Suisse
  • Deutsche Bank
  • HSBC
  • RBS
  • UBS
  • Wells Fargo

Big settlements previously were from:

  • JP Morgan
  • Citigroup
  • BofA

I haven’t been closely watching the long list of settlements arising from having mortgages that went sour during the recession. Or maybe these settlements are merely the federal and state taxes for surviving the recession. Not sure whether I will keep an eye on these additional settlements as news develops.

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