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Lehman Jan 27
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JPMorgan To Pay $1.42 Billion To Lehman Brothers
Jan 26, 2016 | AP (in CNBC)
By Ken Sweet
JPMorgan Chase has agreed to pay $1.42 billion to settle allegations that it withheld critical funds from Lehman Brothers in the final days leading up to Lehman's collapse during the financial crisis. Lehman's failure is considered a critical moment in the financial crisis, one that helped deepen and extend the U.S... -
JPMorgan Pays Almost $2.5bn To Settle Legal Disputes
Jan 26, 2016 | Financial Times
By Laura Noonan and Ben McLannahan
JPMorgan Chase will be left almost $2.5bn out of pocket after the US bank finally settled two of its biggest legal headaches left over from the financial crisis. Insurer Ambac said on Tuesday that it would receive almost $1bn from the bank to settle a long-running lawsuit about the sale of mortgage-backed securities. -
JP Morgan Settles Most Of Lehman Claim For $1.42bn
Jan 26, 2016 | BBC
US banking giant JP Morgan Chase will pay $1.42bn (£990m) to settle most of the legal claims accusing it of draining Lehman Brothers of cash at the time of the 2008 financial crash. Lehman Brothers was one of the few major institutions that collapsed without a bailout during the meltdown. JP Morgan was Lehman's main short-term... -
JPMorgan Settles Two Major Cases
Jan 26, 2016 | Business Finance News
By Mohammad Shehmir
Yesterday, JPMorgan Chase & Co. (NYSE:JPM) has agreed to pay $1.42 billion to settle its Lehman Brother Holdings cases. The bank was accused draining Lehman Brothers of much needed liquidity in its final days during the September 2008 collapse. Today, it agreed to pay Ambac Financial Group Inc. $995 million to settle lawsuits... -
JPMorgan’s Lehman Settlement Crosses the $1 Billion Threshold
Jan 26, 2016 | DSNews
By Brian Honea
JPMorgan Chase has agreed to pay $1.42 billion to Lehman Brothers Holdings to settle claims that JPMorgan drained Lehman of billions of dollars before the investment banking firm’s infamous collapse in 2008, according to JPMorgan’s 8-K filing with the Securities and Exchange Commission (SEC) on Tuesday. -
JPMorgan Pays $1.42b To Settle Lehman Claims
Jan 26, 2016 | Housingwire
By Brena Swanson
Wrapping up most of its issues with the company, JPMorgan Chase announced late Monday night that it has agreed to pay the remnants of Lehman Brothers Holdings Inc. $1.42 billion in cash, according to an article in The Wall Street Journal. The article said that the agreement settles most of the failed investment bank’s lawsuit over claims...
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JPMorgan To Pay $1.42 Billion To Lehman Brothers
Jan 26, 2016 | AP (in CNBC)
By Ken Sweet
JPMorgan Chase has agreed to pay $1.42 billion to settle allegations that it withheld critical funds from Lehman Brothers in the final days leading up to Lehman's collapse during the financial crisis.
Lehman's failure is considered a critical moment in the financial crisis, one that helped deepen and extend the U.S. recession.
As Lehman's clearing bank, JP Morgan provided the cash that Lehman used to do business every day. In the final days leading up to Lehman's failure, JPMorgan executives began to worry that the collateral Lehman pledged was less valuable than Lehman said it was. JPMorgan worried that if Lehman couldn't pay back the cash, JP Morgan might get stuck with billions of dollars' worth of what were then being called "toxic assets."
As a result, JPMorgan required Lehman to pledge increasing amounts of collateral in order to keep Lehman's operations open.
Lehman Brothers' bankrupt entity originally sued JPMorgan Chase in 2010 for $8.6 billion, alleging that JPMorgan used its position as Lehman's clearing bank to extract virtually all of Lehman's remaining liquid assets and establish an $8.6 billion "slush fund" for its own use. A federal judge ruled in favor of most of the allegations against JPMorgan in October 2015.
A JPMorgan spokesman declined to comment on the settlement. The bank said in a regulatory filing that the settlement will have no impact on the bank's first quarter results.
The funds will be distributed to Lehman's creditors as part of its bankruptcy proceedings. Lehman Brothers filed for bankruptcy in September 2008 after federal regulators chose not to save the bank from collapse, even though they had saved Bear Stearns in March of that year...
For full story: http://www.cnbc.com/2016/01/26/the-associated-press-jpmorgan-to-pay-142-billion-to-lehman-brothers.html
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JPMorgan Pays Almost $2.5bn To Settle Legal Disputes
Jan 26, 2016 | Financial Times
By Laura Noonan and Ben McLannahan
JPMorgan Chase will be left almost $2.5bn out of pocket after the US bank finally settled two of its biggest legal headaches left over from the financial crisis.
Insurer Ambac said on Tuesday that it would receive almost $1bn from the bank to settle a long-running lawsuit about the sale of mortgage-backed securities.
The news came just hours after court filings revealed that JPMorgan would pay $1.42bn to end most of its remaining disputes with the estate of the defunct Lehman Brothers.
The bank issued stock exchange statements saying that neither settlement would “materially” affect earnings for the first quarter.
The Ambac lawsuit centred on mortgage-backed securities sold by an arm of Bear Stearns, which JPMorgan acquired in 2008. Ambac alleged that the Bear Stearns unit misrepresented the securities. Court documents showed one Bear Stearns employee referred to some of the securities as a “sack of shit”.
“Today’s announcement validates our resolve and reinforces our confidence in our remaining RMBS-related cases,” Nader Tavakoli, Ambac president and chief executive, said. “This settlement will have a positive impact on our fourth-quarter 2015 operating results, as well as our claims paying resources.”
The bank declined to comment, citing its stock exchange announcement where it noted the settlement. In recent years, US banks have often used the period right after earnings to announce legal settlements.
The big banks’ fourth-quarter earnings season, which ended last week, was notable for a relative absence of huge penalties disclosed. Goldman Sachs took a $1.5bn hit for mis-selling mortgages in the run-up to the crisis, part of a total $5.1bn settlement, while BNY Mellon’s profits were docked by a $170m charge connected to the collapse of a client in 2007. But overall, the tone of management discussions was that many of the big legal matters arising from the crisis are in the rear-view mirror.
That was reflected in the banks’ estimates of possible losses above their existing reserves, which five of the big six — JPMorgan, Bank of America, Citigroup, Wells Fargo and Goldman Sachs — report in their 10-Q statements.
At the end of the third quarter last year, aggregate estimates stood at $21bn, down from a peak of $27bn two years earlier, according to Autonomous Research.
But analysts remain wary, fearing that another matter like the manipulation of the foreign-exchange market could suddenly loom large. Threats on the radar screen include a probe into possible rigging of the $12.5tn US government-bond market, and banks’ use of specialised trades to exploit different countries’ varying tax rates on stock-dividend payments.
Brian Foran, a partner at Autonomous, said that while he hoped banks were in the “ninth inning” of litigation payouts, he could not be sure.
“The list feels endless,” he said. “I was joking with a client this morning, every time you think you’ve cleared something up, you find someone else wants to settle.”
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Court documents filed in New York show that JPMorgan agreed to make the $1.42bn payment to the estate of Lehman Brothers to settle allegations that it took steps to unfairly jump the creditors’ queue when Lehman was collapsing.
JPMorgan was Lehman’s largest creditor and has been embroiled in the defunct bank’s estate since its 2008 failure. Many of Lehman’s claims against JPMorgan were thrown out by a judge in October.
“The Settlement Agreement finally resolves two of the three major pieces of litigation pending against . . . in exchange for a cash payment of $1.42bn and the Lehman parties’ agreement to withdraw those challenges,” the court filings said...
For full story: http://www.ft.com/intl/cms/s/0/b9a67896-c40d-11e5-b3b1-7b2481276e45.html?ftcamp=published_links%2Frss%2Fcompanies%2Ffeed%2F%2Fproduct#axzz3yQW18Bjb
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JP Morgan Settles Most Of Lehman Claim For $1.42bn
Jan 26, 2016 | BBC
US banking giant JP Morgan Chase will pay $1.42bn (£990m) to settle most of the legal claims accusing it of draining Lehman Brothers of cash at the time of the 2008 financial crash.
Lehman Brothers was one of the few major institutions that collapsed without a bailout during the meltdown.
JP Morgan was Lehman's main short-term lender before its collapse.
It was accused of contributing to the failure by demanding $8.6bn of collateral as credit markets tightened.
JP Morgan will also pay the insurer Ambac $995m in settlement of a case involving the sale of mortgage-backed securities.
JP Morgan says the payouts will not "have a material" effect on its earnings...
For Full Story: http://www.bbc.com/news/business-35412817
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JPMorgan Settles Two Major Cases
Jan 26, 2016 | Business Finance News
By Mohammad Shehmir
Yesterday, JPMorgan Chase & Co. (NYSE:JPM) has agreed to pay $1.42 billion to settle its Lehman Brother Holdings cases.
The bank was accused draining Lehman Brothers of much needed liquidity in its final days during the September 2008 collapse. Today, it agreed to pay Ambac Financial Group Inc. $995 million to settle lawsuits alleging it of distorting the quality of mortgages on which it issued several securities. Lehman Brothers Case
This settlement has occurred nearly four months after a US District court ruled in favor of JPMorgan, adding that it had no obligation to save Lehman. Lehman Brothers showed assets worth $639 billion when filed for Chapter 11 protection. This is the highest value of assets during which bankruptcy has been reported, in US history.
According to the court’s filings: “The Settlement Agreement finally resolves two of the three major pieces of litigation pending against…in exchange for a cash payment of $1.42 billion and the Lehman Parties’ agreement to withdraw those challenges.”
JPMorgan was accused of using Lehman Brothers’ main clearing bank to draw billions of dollars’ worth of collateral, a few days before Lehman went bankrupt on September 15, 2008. The lawsuit was worth $8.6 billion, which JPMorgan was able to settle in significantly less. The base of the charge was that JPMorgan sucked funds out of Lehman even though it had no need for them.
Earlier, Lehman also challenged JPMorgan on getting rid of many derivative contracts soon after bankruptcy. According to Lehman Brothers, JPMorgan had already paid an amount greater than $105 billion to unsecured creditors. Lehman Brothers' total disbursement to creditors, including this one, will equal to $106.5 billion.
According to Reuters, the settlement is not expected to affect JPMorgan's earnings in the upcoming quarter significantly. It posted net income for fiscal 2015 (FY15) at $24.4 billion. On the other hand, some of the banks have profited from Lehman settlements. Barclays’ FY15 profit increased $750 million as Lehman agreed to give it most of the $1.1 billion in disputed assets...
For full story: http://www.businessfinancenews.com/27450-jpmorgan-settles-two-major-cases/
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JPMorgan’s Lehman Settlement Crosses the $1 Billion Threshold
Jan 26, 2016 | DSNews
By Brian Honea
JPMorgan Chase has agreed to pay $1.42 billion to Lehman Brothers Holdings to settle claims that JPMorgan drained Lehman of billions of dollars before the investment banking firm’s infamous collapse in 2008, according to JPMorgan’s 8-K filing with the Securities and Exchange Commission (SEC) on Tuesday.
According to the filing, Lehman had been seeking the return of $7.9 billion in collateral and billions in “consequential damages based on bankruptcy and common law causes of action.” Lehman was also trying to recover approximately $2.4 billion related to claims by the investment banking firm out of JPMorgan’s closeout of thousands of derivatives transactions outstanding between the two firms after Lehman had filed for bankruptcy in September 2008.
A spokesman for JPMorgan Chase declined to comment beyond what was contained in the 8-K filing with the SEC.
The lawsuit was originally filed by Lehman in 2010, claiming that JPMorgan had created an $8.6 billion “slush fund” in 2008 just before the investment bank filed for bankruptcy, which Lehman termed “voracious,” according to a report from the Wall Street Journal. Lehman had put up billions of dollars in collateral for the derivative transactions as well as overnight loans that JPMorgan arranged. JPMorgan was providing daily cash advances, some worth as much as $100 billion, to Lehman in order to facilitate overnight repurchase agreements, which was the main source of contention following the investment bank’s failure. JPMorgan later countersued Lehman.
The settlement between JPMorgan Chase and Lehman is pending approval from the U.S. Bankruptcy Court in New York.
In a separate 8-K filing with the SEC, JPMorgan Chase announced that it had agreed to pay $995 million to Ambac Assurance Corporation over the sale of 11 residential mortgage-backed securities sponsored by EMC Mortgage, an indirect subsidiary of JPMorgan Chase...
For full story: http://www.dsnews.com/news/01-26-2016/jpmorgan-chase-settles-with-lehman-brothers-for-more-than-1-billion
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JPMorgan Pays $1.42b To Settle Lehman Claims
Jan 26, 2016 | Housingwire
By Brena Swanson
Wrapping up most of its issues with the company, JPMorgan Chase announced late Monday night that it has agreed to pay the remnants of Lehman Brothers Holdings Inc. $1.42 billion in cash, according to an article in The Wall Street Journal.
The article said that the agreement settles most of the failed investment bank’s lawsuit over claims that JPMorgan illegally siphoned billions of dollars from Lehman before its collapse.
From The Wall Street Journal:
The deal, unveiled Monday night in a filing in U.S. Bankruptcy Court in New York, resolves the bulk of Lehman’s $8.6 billion lawsuit against J.P. Morgan and the bank’s counterclaims against Lehman. It also puts to rest Lehman’s challenges over J.P. Morgan’s closeout of thousands of derivatives contracts following the investment bank’s collapse...
For full story: http://www.housingwire.com/articles/36107-jpmorgan-pays-142b-to-settle-lehman-claims
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JP Morgan
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