Bank Of America Pays $10 Billion To Fannie Mae And Fannie Mac

Bank of America announced that it will pay $10 billion to Fannie Mae and Freddie Mac for bad mortgage loans that they purchased from Countrywide.  That brings the total cost of legal claims, and real estate losses to $50 billion due to Bank Of America's ill advised purchase Countrywide.  Bank of America has also lost billions from its acquisition of Merrill Lynch.  Investors sued Merrill for damages from mortgage backed securities that were misrepresented by Merrill.  Bank of America shareholders have suffered huge losses from those acquisitions.  Pension funds, who purchased Bank of America stock have also sued the firm for misrepresenting the financial status of Merrill when it made the acquisition.

This article does not mention it, but Fannie Mae and Freddie Mac lost most of their money on loans and securities that they purchased from Bank of America and other Wall Street Banks during the real estate boom.  Their losses were not primarily the result of bad mortgages that they originated to satisfy government officials who wanted them to provide mortgages to the needy.