{"id":5402,"date":"2013-02-20T00:00:00","date_gmt":"2013-02-20T06:00:00","guid":{"rendered":"https:\/\/institutionalinvestorsecuritiesblog.blawgcloud.com\/2013\/02\/new_york_fed_bailed_out_bank_o"},"modified":"2022-05-02T15:32:17","modified_gmt":"2022-05-02T20:32:17","slug":"new-york-fed-bailed-out-bank-o","status":"publish","type":"post","link":"https:\/\/www.investorlawyers.com\/blog\/new-york-fed-bailed-out-bank-o\/","title":{"rendered":"New York Fed Bailed Out Bank of America Over Mortgage-Backed Securities Sold to AIG"},"content":{"rendered":"

Recently, a secret deal came to light involving the Federal Reserve Bank of New York bailing out Bank of America (BAC)<\/a> that released the latter from all legal claims involving mortgage-backed securities<\/a> losses that the former obtained when the government rescued American International Group (AIG)<\/a> in 2008. Some believe that the bank was allowed to abscond responsibility even as AIG sought to recover $7 billion that was loss on these same MBSs.<\/p>\n

According to The New York Times<\/em>, as part of its settlement with BofA, the New York Fed obtained $43 million in a securities dispute involving two of the mortgage securities. For no compensation, the bank was released from all other legal claims.<\/p>\n

The roots of this settlement can be traced back to 2008 when the government intervened to rescue AIG <\/a>. Part of that aid involved AIG selling mortgage securities to Maiden Lane II, which the New York Fed oversees. At the time, the insurer was losing money from toxic mortgages, many of which came from BofA. AIG obtained $20.8 billion for securities valued at $39.2 billion.<\/p>\n

Continue Reading \u203a<\/a><\/div>\n","protected":false},"excerpt":{"rendered":"

Recently, a secret deal came to light involving the Federal Reserve Bank of New York bailing out Bank of America (BAC) that released the latter from all legal claims involving mortgage-backed securities losses that the former obtained when the government rescued American International Group (AIG) in 2008. Some believe that the bank was allowed to […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[3987,3751,3752,3757],"tags":[],"class_list":["post-5402","post","type-post","status-publish","format-standard","hentry","category-american-international-group","category-bank-of-america","category-financial-firms","category-mortgagebacked-securities"],"yoast_head":"\nNew York Fed Bailed Out Bank of America Over Mortgage-Backed Securities Sold to AIG — Investor Lawyers Blog — February 20, 2013<\/title>\n<meta name=\"description\" content=\"Recently, a secret deal came to light involving the Federal Reserve Bank of New York bailing out Bank of America (BAC) that released the latter from all — February 20, 2013\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, 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