Tag Archives: RBS

Nomura, RBS agree to pay $839M over mortgage bonds

Nomura Holdings (NMR) and The Royal Bank of Scotland(RBS) have agreed to a settlement in federal court to pay $839 million over the sale of mortgage-backed securities.

Both banks were found guilty in May by U.S. District Judge Denise Cote in Manhattan after a non-jury trial and were directed to pay $806 million including $26.6 million toFannie Mae and $779.4 million to Freddie Mac.

“The offering documents did not correctly describe the mortgage loans,” the judge said in his lengthy, 361-page decision. “The magnitude of falsity, conservatively measured, is enormous.”

Nomura and RBS denied the FHFA’s allegations at the time of the verdict.

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Nomura, RBS must pay $806 million in mortgage bond case: U.S. judge

A U.S. judge on Friday ordered Nomura Holdings Inc (>> Nomura Holdings, Inc.) and Royal Bank of Scotland Group Plc (>> Royal Bank of Scotland Group plc) to pay a collective $806 million for making false statements in selling mortgage-backed securities to Fannie Mae (>> Federal National Mortgage Assctn Fnni Me) and Freddie Mac (>> Federal Home Loan Mortgage Corp).

U.S. District Judge Denise Cote in Manhattan entered the judgment after finding the banks liable on Monday following a non-jury bench trial in a lawsuit by the Federal Housing Finance Agency over securities sold ahead of the 2008 financial crisis.

Under the order, Fannie Mae will receive $26.6 million while Freddie Mac will be paid $779.4 million by the two firms.

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Nomura, RBS ‘crap’ emails come into play in $1 billion mortgage bond trial

NEW YORK (Reuters) – In 2007, a Royal Bank of Scotland Group Plcemployee emailed his boss with his view of a sample of mortgages underlying a bond that the bank was underwriting: “This one is crap.”

Asked about it this week in Manhattan federal court, Brian Farrell, the employee, said he did not recall the deal. But a U.S. regulator cited the email as evidence that Nomura Holdings Inc <8604.T> and RBS made false statements about mortgage securities they sold to Fannie Mae and Freddie Mac.

The email and others like it are part of a $1.1 billion lawsuit by the Federal Housing Finance Agency against Nomura and RBS that went to trial this month. The messages add to a litany of arguably embarrassing electronic musings by bank employees that have resurfaced in litigation over the 2008 financial crisis.

Private plaintiffs and U.S. regulators alike have seized upon internal emails from the likes of JPMorgan Chase & Co and Deutsche Bank AG calling the mortgage products they sold investors “lemons,” “junk,” and “pigs.”

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U.S. agency seeks $1.1 billion as Nomura, RBS face mortgage bond trial

A U.S. housing regulator urged a federal judge on Monday to award it $1.1 billion due to false claims made about “crap” mortgages underlying securities sold by Nomura Holdings Inc (>> Nomura Holdings, Inc.) to Fannie Mae (>> Federal National Mortgage Assctn Fnni Me) and Freddie Mac (>> Federal Home Loan Mortgage Corp) ahead of the 2008 financial crisis.

At the start of a trial in Manhattan federal court, a lawyer for the Federal Housing Finance Agency said misrepresentations by Nomura and Royal Bank of Scotland Group Plc (>> Royal Bank of Scotland Group plc), an underwriter, about loans underlying $2 billion (1.3 billion pounds) in securities exemplified broader misconduct by banks ahead of the crash.

“Nomura and RBS were very willing participants in creating the worst economic crisis since the Great Depression,” Philippe Selendy, a lawyer for the FHFA, said in an opening statement.

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Former RBS trader pleads guilty in U.S. to cheating customers

(Reuters) – A bond trader pleaded guilty on Wednesday to conspiring to defraud Royal Bank of Scotland Group Plc (>> Royal Bank of Scotland Group plc) customers by lying about the prices of bond transactions he handled for them in an effort to boost the bank’s profit.

Matthew Katke, 34, of New York, pleaded guilty to one count of conspiracy to commit securities fraud and will cooperate with prosecutors, U.S. Attorney Deirdre Daly in Connecticut said.

The plea came one year after a federal jury in New Haven, Connecticut in a similar case convicted former Jefferies Group Inc managing director Jesse Litvak for cheating his customers on prices of mortgage-backed securities.

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SocGen Enters CMBS Market in U.S. by Hiring Team From RBS

(Bloomberg) — Societe Generale SA is entering the U.S. commercial-mortgage-backed securities market and has hired a team of more than 10 people from Royal Bank of Scotland Group Plc for the effort.

Wayne Potters, who most recently led RBS’s commercial real-estate group, will head the CMBS group for the French bank, according to an e-mailed statement. Societe Generale said it also hired Adam Ansaldi, who previously oversaw the CMBS distribution and securitization at RBS.

The bank is seeking “to develop asset-backed product capabilities that will take advantage of a trend towards increased securitization to finance the economy at a time when many banks’ capacity to hold assets on their balance sheets is limited,” according to the statement.

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RBS Admits Mis-Selling Taxpayer-Backed Scheme

Royal Bank of Scotland (RBS) is contacting 1,800 small business customers who are believed to have suffered under the latest mis-selling scandal to hit the bank.

RBS said the issue came to light following a review of customer files following complaints to the British Business Bank, the Government body overseeing the Enterprise Finance Guarantee (EFG).

The scheme, set up in 2009, has seen RBS loan more than £900m to 9,000 small firms who would otherwise have found it difficult to access credit.

RBS said: “This exercise identified a number of instances where we have not properly explained to customers how borrower and guarantor liabilities work under the EFG scheme.

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