Goldman Sachs Says $5.1 Billion Mortgage Settlement Will Knock $1.5 Billion Off Q4 Earnings
Goldman Sachs Group on Thursday agreed to pay $5.1 billion to end an investigation into its packaging of residential mortgage-backed securities in the run-up to the financial crisis, reports Forbes.
“Thursday’s agreement with the RMBS Working Group of the U.S. Financial Fraud Enforcement Task Force, still subject to finalization with the Justice Department and other authorities, includes a $2.4 billion civil monetary penalty and calls for $875 million in cash payments and $1.8 billion in ‘consumer relief’ such as forgiving principal for borrowers whose homes are worth less than their remaining mortgage obligations and supporting foreclosure prevention,” Forbes reports.
The bank said the settlement would knock $1.5 billion off its after-tax earnings from the fourth quarter of 2015.
