UPDATE 1-Assured says to be paid $358 mln as it settles UBS suit
* Assured, UBS enter in loss-sharing agreement on future claims
* Assured shares up 4 pct
May 6 (Reuters) - Bond insurer Assured Guaranty Ltd said UBS AG will pay it $358 million to settle a lawsuit that accused the bank of falsely representing the quality of the loans underlying $1.49 billion of mortgage-backed securities.
Assured shares were up 3 percent at $21.47 in early trading on Monday on the New York Stock Exchange.
UBS and Assured have also entered into loss-sharing agreement on future claims, which will take effect from the third-quarter.
"UBS represents the third financial institution with which we have reached a major settlement since 2011," Assured Chief Executive Dominic Frederico in a statement.
Assured sued UBS in February 2012 after the bank declined to repurchase hundreds of millions of dollars worth of mortgages. The lawsuit, which claimed breach of contract, focused on financial guaranty insurance Assured provided in 2006 and 2007 to three mortgage-backed securities transactions.
In its complaint, Assured said it had paid out $308.2 million in claims related to the securities by the end of January 2012.
"The financial effect of the settlement on UBS is insignificant due to provisions that we had previously established," UBS said in a statement on Monday.
Assured has filed similar lawsuits against units of JPMorgan Chase & Co, Credit Suisse and Flagstar Bancorp Inc. It had earlier reached settlements with Bank of America for $1.1 billion and Deutsche Bank for $165.6 million, without filing lawsuits against them.
The case is Assured Guaranty Municipal Corp. V. UBS Real Estate Securities, Inc., U.S. District Court, Southern District of New York, No. 12-01579.