Swiss bank UBS will pay $885m (£575m) in a settlement with US regulators over allegations it misrepresented mortage-backed bonds during the housing bubble, it was announced today.
The Federal Housing Finance Agency (FHFA), which oversees state-sponsored housing enterprises Fannie Mae and Freddie Mac, said that UBS would pay $415m to Fannie May and $470m to Freddie Mac to resolve claims related to securities sold to the companies between 2004 and 2007.
FHFA Acting Director Edward J. DeMarco said:
The satisfactory resolution of this matter provides greater clarity and certainty in the marketplace and is in line with our responsibility for preserving and conserving Fannie Mae’s and Freddie Mac’s assets on behalf of taxpayers.
The settlement agreement can be read in full here.
UBS is one of 18 banks the FHFA pursued in 2011 over these allegations of misrepresentation and is the third to settle after Citigroup and General Electric did so for undisclosed amounts.