Statement by Michael J. Williams, President and Chief Executive Officer
Fannie Mae has reached an agreement with Bank of America, N.A., and its affiliates — BAC Home Loans Servicing, LP, and Countrywide Home Loans, Inc. — to address outstanding repurchase requests for residential mortgage loans with an unpaid principal balance of approximately $3.9 billion delivered to Fannie Mae by affiliates of Countrywide Financial Corporation. Bank of America agreed, among other things, to a resolution amount of approximately $1.52 billion, consisting of a cash payment of $1.34 billion made by Bank of America on December 31, 2010, and credits for payments recently made or to be made by them. This significant agreement with Bank of America is a fair and responsible resolution of these outstanding claims.
The agreement substantially resolves outstanding repurchase requests on 12,045 loans sold to us by Countrywide, addresses 5,760 other loans sold to us by Countrywide and permits us to bring claims for any additional breaches of our representations and warranties that are identified with respect to those loans. Fannie Mae continues to work with Bank of America to resolve repurchase requests that remain outstanding, including requests relating to loans delivered to the company by Bank of America, N.A.
Fannie Mae pursues repurchase requests to protect the interests of the company and to prudently manage the resources we have been provided. This agreement with Bank of America addresses approximately 44 percent of the $7.7 billion in repurchase requests (measured by unpaid principal balance) we had outstanding with all of our seller servicers as of September 30, 2010.
We appreciate Bank of America's work to reach this agreement and look forward to our continued mutual efforts to support the U.S. housing market.Fannie Mae exists to expand affordable housing and bring global capital to local communities in order to serve the U.S. housing market. Fannie Mae has a federal charter and operates in America's secondary mortgage market to enhance the liquidity of the mortgage market by providing funds to mortgage bankers and other lenders so that they may lend to home buyers. Our job is to help those who house America.