Tags: dick | Bove | banks | Lose | 80-Billion | Mortgage | Mess

Bove: Banks Could Lose $80 Billion from Mortgage Mess

Friday, 15 Oct 2010 01:46 PM

Banks could face losses of over $80 billion from the foreclosure mess not because of the moratorium on home seizures but from the flood of homeowner and investor lawsuits likely to follow, analyst Dick Bove said Friday, CNBC.com reported.

The lawsuits are likely to focus on "fraud at every level of the process" — from packaging mortgages into bonds to selling them to investors, the Rochdale Securities analyst said in a note to clients, CNBC reported.

The legal fallout could cost the industry more than $80 billion, about 10 times the amount that Bove sees banks losing from the foreclosure halt itself, CNBC reported.

Attorneys general in all 50 U.S. states are looking at allegations that for years banks failed to review documents properly or submitted false statements in support of foreclosure applications.

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Banks could face losses of over $80 billion from the foreclosure mess not because of the moratorium on home seizures but from the flood of homeowner and investor lawsuits likely to follow, analyst Dick Bove said Friday, CNBC.com reported. The lawsuits are likely to focus...
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