The Royal Bank of Scotland has settled a lawsuit accusing it of misleading a failed corporate credit union in the sale of residential mortgage-backed securities.
In September 2013, the National Credit Union Administration filed multiple lawsuits against nine companies that were involved in the sale of RMBS to Southwest Corporate Federal Credit Union.
The Plano, Texas-based corporate credit union was seized by the NCUA in September 2009. Expected related losses were estimated at around $14 million.
On Wednesday, the NCUA announced that the Royal Bank of Scotland has settled the lawsuit.
The settlement will cost RBS $129.6 million.
The NCUA noted that it has so far collected $1.9 billion in legal recoveries related to corporate credit unions that failed due to bad RMBS investment.
The regulator said litigation is still pending against RBS from RMBS sold to the failed corporate credit unions
U.S. Central and Wescorp.
In addition, lawsuits are still pending against
Goldman Sachs, Wachovia, UBS, Barclays, Credit Suisse and Morgan Stanley.
