Royal Bank of Scotland reaches $5.5B settlement for US mortgages issued before financial crisis

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LONDON (AP) – Royal Bank of Scotland says it has reached a $5.5 billion settlement in the United States over mortgage-backed securities issued before the financial crisis.

The deal with the Federal Housing Finance Agency – the conservator of Fannie Mae and Freddie Mac – resolves claims regarding the issuance and underwriting of approximately $32 billion (25 billion pounds) of residential mortgage-backed securities.

RBS CEO Ross McEwan says the announcement is “an important step forward in resolving one of the most significant legacy matters facing RBS.”

McEwan has been at pains in recent months to insist RBS has put its legacy issues behind them. He says “this settlement is a stark reminder of what happened to this bank before the financial crisis, and the heavy price paid for its pursuit of global ambitions.”

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