Citigroup today announced an agreement with Fannie Mae to resolve potential future repurchase claims for breaches of representations and warranties on 3.7 million residential first mortgage loans sold to Fannie Mae that were originated between 2000 and 2012 (“Covered Loans”). Citi agreed to pay Fannie Mae $968 million under the agreement, substantially all of which was covered by Citi’s existing mortgage repurchase reserves as of March 31, 2013.
Jane Fraser, CEO of CitiMortgage, said, “We have a strong and productive relationship with Fannie Mae. This agreement resolves substantially all potential future repurchase claims from them for loan originations from 2000 to 2012. As we work to deepen and enhance financial relationships with our clients, we will continue to focus on the production of high-quality mortgage loans.”
Citi’s agreement with Fannie Mae covers potential future origination-related representation and warranty claims on the Covered Loans. It does not release Citi’s liability with respect to its servicing or other ongoing contractual obligations on the Covered Loans. It also does not release liability to a population of less than 12,000 loans originated between 2000 and 2012 with certain characteristics such as loans sold with a performance guaranty or under special credit enhancement programs. Citi currently believes it is adequately reserved for the loans not covered by the agreement. Citi has and will continue to work with Fannie Mae on the timely repurchase of any mortgage loans sold to Fannie Mae that do not meet Fannie Mae’s requirements.
Citi will issue its second quarter results on July 15, 2013. Citi currently estimates that it will record a residential mortgage repurchase reserve build of $245 million in the second quarter of 2013, which is generally consistent with its repurchase reserve builds in recent quarters.Citi Citi, the leading global bank, has approximately 200 million customer accounts and does business in more than 160 countries and jurisdictions. Citigroup provides consumers, corporations, governments and institutions with a broad range of financial products and services, including consumer banking and credit, corporate and investment banking, securities brokerage, transaction services, and wealth management.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV