The National Credit Union Administration (NCUA) and HSBC have reached a settlement regarding potential claims related to the sale of residential mortgage-backed securities (RMBS) to five failed wholesale credit unions.
HSBC has agreed to pay NCUA $5.25 million to reduce the losses associated with the five failures. The settlement with HSBC does not admit fault on their part. NCUA will use the net proceeds from this settlement to further reduce assessments being charged to credit unions to pay for the losses.
‘This is NCUA's third favorable settlement of actionable claims,’ says NCUA Board Chairman Debbie Matz. ‘We appreciate HSBC's efforts to resolve potential claims so that we can avoid the expense and delay of litigation.’
NCUA filed five lawsuits against other securities firms alleging violations of federal and state securities laws and misrepresentations in the sale of hundreds of securities. NCUA has reached settlements of $145 million with Deutsche Bank Securities and $20.5 million with Citigroup.