Wells Fargo & Co., the fourth-largest U.S. bank by assets, said it would pay $591 million to Fannie Mae to substantially settle all repurchase liabilities related to loans sold to the government-controlled mortgage company before Jan. 1, 2009.

Fannie Mae will receive about $541 million in cash after adjusting for credits related to certain prior repurchases, the San Francisco-based bank said.

The cost of the agreement has been fully accrued for as of Sept. 30, Wells Fargo said.