Updated to include a statements from Wells Fargo and SunTrust Bank.
NEW YORK ( TheStreet) -- Ten of the nation's largest housing lenders have settled with the Federal Reserve and the Office of Controller of Currency (OCC) for $8.5 billion on improper foreclosure practices between 2009 and 2010.
While some lenders like Bank of America (BAC) and Citigroup (C) quickly spelled out the price tag of the settlement for investors, other banks involved such as JPMorgan Chase (JPM) and Wells Fargo (WFC) were notably slow to offer up details.
For investors, the disparity in disclosures between banks involved in the settlement raises the question of why all the secrecy?Bank of America said that the settlement and a $10 billion deal cut with Fannie Mae on faulty mortgage securities Monday will create two separate charges of $2.5 billion and $2.7 billion, which will eliminate most of the bank's expected fourth quarter profit. In press releases, Citigroup and US Bancorp (USB) said the foreclosure review will shave off $305 million and $80 million in fourth quarter earnings, respectively, as a result of the cash component of the settlement. Citigroup will contribute a further $500 million and US Bancorp $128 million to mortgage assistance and loan modifications as part of the non-cash component of the settlement, they added in Monday morning press releases listed on their websites. For others involved in the settlement, the costs of Monday's deal -- called the independent foreclosure review -- were less apparent to the ordinary investing public. Only after the market close was Wells Fargo able to quantify the costs of the settlement to investors. Wells Fargo said it will pay $766 million for the cash portion of the settlement, in a move that will create a $644 million charge to the company's fourth quarter earnings due on Friday. Wells Fargo added in the statement sent after the market close it will also commit a further $1.2 billion to foreclosure prevention actions, which the lender said has already been provisioned for. "We are pleased that the regulators and servicers came together to reach this settlement, which will bring resolution to more borrowers in an expedited manner," Mike Heid, president of Wells Fargo Home Mortgage, said in an e-mailed statement. Metlife (MET) said in an emailed statement sent to TheStreet that it will take a $37 million pre-tax hit to earnings it characterized as "not material to the company." "MetLife has been fully cooperating with the OCC look back process and has agreed to join the settlement with the major banks. MetLife's portion of the $8.5 billion settlement is $37 million pre-tax and is not material to the company," John Calagna, a MetLife spokesperson, said in an e-mailed statement. JPMorgan, meanwhile, says it will disclose the costs of a settlement in an 8-K filing with the Securities and Exchange Commission that hadn't been filed as of Monday's market close. "
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