| NEW YORK, June 27
NEW YORK, June 27 Bank of America Corp
has rejected a bid to re-open negotiations into its proposed
$8.5 billion settlement with investors in mortgage securities,
indicating it plans to take its chances that a New York judge
will approve the deal.
American International Group Inc and the Federal
Home Loan Banks of Boston, Chicago and Indianapolis, which
object to the settlement, sent a letter to Bank of New York
Mellon Corp, the trustee overseeing the securities.
The letter, which was filed in New York State Supreme Court
on Thursday, requested immediate settlement discussions.
"We are willing and available now to discuss ... how to best
construct an open, fair and transparent process," Daniel Reilly,
a lawyer for AIG, and Derek Loeser, a lawyer for the home loan
AIG and other objectors complained that the accord offered
them only a fraction of what they lost, and was negotiated
Justice Barbara Kapnick, who is hearing testimony to decide
whether to approve the settlement, had asked the parties to
consider mediation rather than wait for her to rule.
Kapnick made the request on June 14 before a break in the
proceeding, which resumes July 8, the letter said.
Bank of America had agreed to the settlement two years ago
to resolve the claims of investors in bonds issued by mortgage
lender Countrywide Financial Corp, which it bought in 2008.
It hopes a settlement, if approved, will resolve much of its
remaining legal obligations stemming from Countrywide.
The Charlotte, North Carolina-based bank paid $2.5 billion
for Countrywide, but the purchase became an albatross and has
cost the bank tens of billions of dollars for litigation, loan
buybacks and other mortgage-related costs.
Twenty-two institutional investors, including BlackRock Inc
, MetLife Inc and Allianz SE's Pacific
Investment Management Co entered into the settlement.
The case is In re: Bank of New York Mellon, New York State
Supreme Court, New York County, No. 651786/2011.