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The schemes, however, are likely to match those agreed with other banks for the mis-selling of residential mortgage bond securities.. Goldman Sachs agreed in April to pay $1.8bn in consumer relief as part of its $5bn settlement.
The DoJ's legal filing outlines an array of colourful descriptions of the types of mortgages that it alleges were used by Barclays to package up in bonds – known as residential mortgage bond securities – which could be sold on to investors.
The deregulation of the S&L industry between 1980 and 1982 had enabled those smaller banks, or thrifts -- focused on taking deposits and providing mortgages -- to compete with commercial banks for depositors and to invest that money (and money borrowed against it) in more speculative real estate ventures and junk bond securities.
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While rarely invoked, bond security provisions establishing collateral of a first mortgage lien on the buildings and property as well as first lien on revenues are definitely de rigueur.
On Wall Street, a huge market evolved in subprime mortgage bonds — securities backed by payment streams from dozens or hundreds of individual subprime mortgages.
Today, the commission sees itself as answerable to many different constituencies, including companies that issue stocks and bonds, securities firms and accounting firms, Mr. Corso said.
It represents by far the biggest issue of "dim sum" bonds, securities denominated in the currency of mainland China, but sold in Hong Kong, where people like to eat dumplings, pork buns and other tasty morsels known as dim sum.
Since joining the bank in 1995 as head of its global markets organization, he took it from an also-ran in trading bonds, securities and foreign currencies to a major and highly profitable player in those activities.
Mr. Trichet also confirmed that the bank would execute a program totaling 60 billion euros ($85 billion) to buy covered bonds — securities created from either mortgage loans or public sector loans — in the 16 countries using the euro.
As part of its stimulus measures, the central bank will initiate a 60 billion euro ($84 billion) program of buying covered bonds — securities created from either mortgage loans or public sector loans — from Monday until the end of June 2010.
With stock prices low and junk bond prices low, prices of hybrid stock-bond securities are low.
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