NEW YORK JPMorgan Chase (JPM) will pay investors $4.5 billion to settle a lawsuit over the sale of residential mortgage-backed securities that soured during the housing crash.
"This settlement is another important step in J.P. Morgan's efforts to resolve legacy related RMBS matters," JPMorgan said in a statement after U.S. financial markets closed. "The firm believes it is appropriately reserved for this and any remaining RMBS litigation matters."
The settlement includes 21 major institutional investors. The mortgage-backed securities were issued by JPMorgan and Bear Stearns between 2005 and 2008. JPMorgan acquired the failing investment bank Bear Stearns in March 2008.