| NEW YORK
NEW YORK Jan 22 Trustees extended by two months
the deadline for them to decide whether to accept JPMorgan Chase
and Co's proposed $4.5 billion settlement with investors
who lost money on mortgage-backed securities.
In a notice dated Jan. 17, seven trustees overseeing the
securities said they had opted to extend a Jan. 15 deadline to
accept the offer. The notice, posted on a website run by the
trustees, said none of the trustees had made a determination
"regarding the reasonableness of, or the advisability of,
entering into the proposed settlement agreement."
The agreement with 21 institutional investors in 330
residential mortgage-backed securities trusts gave the trustees
60 days to accept the deal, with a right to extend it for
another 60 days.
JPMorgan Chase made the offer in November as it sought to
get past problems related to mortgage-backed securities issued
before the 2008 financial crisis by the bank and Bear Stearns,
which it bought during the crisis. At the same time, it was also
finalizing a separate $13 billion settlement with the U.S.
government over bad mortgages.
JPMorgan spokesman Brian Marchiony declined to make an
immediate comment on the extension.
Kathy Patrick, a lawyer for the institutional investors,
declined to comment.
The institutional investors include BlackRock Inc,
Goldman Sachs & Co, and Bayerische Landesbank.
Separately, on Wednesday Fir Tree Partners, a private
investment firm, made a tender offer for two of the
mortgage-backed securities trusts subject to the settlement.
"Holders will get their money now rather than waiting for
the settlement payout, which could potentially take months or
years, if it happens at all," Clinton Biondo, a managing
director at Fir Tree Partners, said in a statement.
A similar settlement was reached in 2011 between investors
in mortgage-backed securities issued by Countrywide Financial
and Bank of America Corp, which bought Countrywide in 2008.
That settlement, for $8.5 billion, is awaiting approval by a
New York state judge, Justice Barbara Kapnick.