NEW YORK— U.S. Bank and NCUA have agreed to settle a years-long lawsuit over the bank’s oversight of residential mortgage-backed securities (RMBS) trusts formed ahead of the 2008 financial crisis, Law360 reported.
According to an order issued by U.S. District Judge Louis Stanton here, the court was notified of the agreement and dismissed the case with prejudice and without costs. The order did not disclose terms of the deal, Law360 said.
The NCUA first sued U.S. Bank in 2018, alleging negligence, breach of contract, and breach of fiduciary duty in connection with 50 RMBS trusts established between 2004 and 2007 that later failed. In 2020, Judge Stanton allowed parts of the case to proceed, finding that the regulator had plausibly shown U.S. Bank knew of servicing failures in six of the trusts and breached its post-default obligations, Law360 explained.
But in 2023, the court narrowed the claims, ruling that NCUA hadn’t provided sufficient evidence that the servicers were responsible for maintaining the underlying pool assets.