CHICAGO, Aug. 14, 2012 /PRNewswire/ -- Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include BB&T Corp. (NYSE:BBT), JPMorgan Chase & Co. (NYSE:JPM), Bank of America Corporation (NYSE:BAC), Citigroup Inc. (NYSE:C) and Wells Fargo & Company (NYSE:WFC).
Get the most recent insight from Zacks Equity Research with the free Profit from the Pros newsletter: http://at.zacks.com/?id=5513
Here are highlights from Monday's Analyst Blog:
FDIC Files Lawsuit Related to MBS
The Federal Deposit Insurance Corp. (FDIC) has filed a lawsuit against major banks over the alleged sale of $388 million of risky mortgage-backed securities (MBS) to the failed Colonial Bank. Apart from attorney fees and court expenses, the FDIC is seeking $189 million in damages.
Colonial Bank-based in Montgomery, Alabama failed in August 2009 and was acquired by BB&T Corp. (NYSE:BBT). At that time, Colonial Bank had nearly $25 billion in assets and the FDIC had estimated the cost to the federal deposit-insurance fund to be $2.8 billion.
The major lenders against whose units the FDIC filed the lawsuit include biggies like JPMorgan Chase & Co. (NYSE:JPM), Bank of America Corporation (NYSE:BAC), Citigroup Inc. (NYSE:C), Wells Fargo & Company (NYSE:WFC), among others. The FDIC has alleged that the lenders distorted the facts related to the MBS they sold to Colonial Bank.
Moreover, the FDIC accused the banks of not disclosing authentic facts related to the quality of the underlying assets while selling risky MBS to Colonial Bank. This also included distortion of loan-to-value ratios that were based on the inflated property values. Further, the fact that a large number of these properties had second mortgages was also concealed.
The above-mentioned lawsuit is almost identical to the one that was filed by the U.S. Federal Housing Finance Agency (FHFA) against approximately a dozen big banks. The FHFA sued major banks for infringing commitments on the quality of about $196 billion MBS sold to Fannie Mae and Freddie Mac during the housing bubble.
The FDIC's action comes as a major blow to the big banks that are already facing numerous litigations related to the sale of risky MBS. However, the investors and other financial institutions which suffered as a result of these faulty practices are expected to get a breather.
Want more from Zacks Equity Research? Subscribe to the free Profit from the Pros newsletter: http://at.zacks.com/?id=5515.
About Zacks Equity Research
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
Zacks "Profit from the Pros" e-mail newsletter provides highlights of the latest analysis from Zacks Equity Research. Subscribe to this free newsletter today: http://at.zacks.com/?id=5517
Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978 by Leon Zacks. As a PhD from MIT Len knew he could find patterns in stock market data that would lead to superior investment results. Amongst his many accomplishments was the formation of his proprietary stock picking system; the Zacks Rank, which continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros. In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Register for your free subscription to Profit from the Pros at http://at.zacks.com/?id=5518.
Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.
Follow us on Twitter: http://twitter.com/zacksresearch
Join us on Facebook: http://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts
Disclaimer: Past performance does not guarantee future results. Investors should always research companies and securities before making any investments. Nothing herein should be construed as an offer or solicitation to buy or sell any security.
SOURCE Zacks Investment Research, Inc.