$50 billion bill to come for US banks
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The figures for the penalties US banks probably still have to pay for their financial crisis shenanigans just seem to get bigger and bigger. Wall Street Predicts $50 Billion Bill to Settle U.S. Mortgage Suits is the headline on a New York Times Dealb%k story predicting the price of buying peace from federal authorities who are taking aim at the banks over their role in the mortgage crisis.
Bracing for a potential reckoning, the banks and their outside lawyers are quietly using JPMorgan Chase’s record $13 billion mortgage settlement in November to do the math and determine just how much each bank might have to pay to move beyond the torrent of government mortgage litigation that has dogged them since the financial crisis. Such calculations, people briefed on the matter said, have gained particular urgency among the banks’ board members.If the settlements materialize, they could yield, according to the analysis, $15 billion in relief for consumers — a mixture of cash payments and other assistance, like reductions in the size of homeowners’ loan payments. A payment of $50 billion, made up of a string of separate deals, would amount to roughly half the total annual profit of large American banks in 2012.
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