PNC To Pay $89M To Freddie Mac To Settle Mortgage Dispute


PNC Financial Services Group Inc will pay Freddie Mac $89 million to resolve all repurchase liabilities on home loans sold to the government-backed housing agency through the end of 2008.

The settlement will compensate for past losses and any potential future losses on 900,000 loans sold to Freddie Mac between 2000 and 2008, PNC said in a statement.

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Most of the loans covered under the settlement stem from National City, which PNC bought for $5.2 billion during the financial crisis in 2008.

PNC joins other U.S. banks that have settled with Freddie Mac and Fannie Mae, another government-controlled mortgage company, with regard to the troubled companies they acquired during the financial crisis.

Earlier this week, Bank of America said it settled with Freddie Mac on all claims arising from residential mortgages sold to the agency through the end of 2009.

In January, Bank of America agreed to pay Fannie Mae $3.6 billion to resolve repurchase claims over Countrywide and Bank of America loans from 2000 to 2008.

PNC shares were up 1 percent at $ 75.98 in early trading Friday on the New York Stock Exchange.