U.S. Bank Legal Bills Exceed $100 Billion

Discussion in 'Wall St. News' started by JamesL, Aug 28, 2013.

  1. JamesL


    The six biggest U.S. banks, led by JPMorgan Chase & Co. (JPM) and Bank of America Corp., have piled up $103 billion in legal costs since the financial crisis, more than all dividends paid to shareholders in the past five years.

    That’s the amount allotted to lawyers and litigation, as well as for settling claims about shoddy mortgages and foreclosures, according to data compiled by Bloomberg. The sum tops the banks’ combined profit last year.

    The mounting bills have vexed bankers who are counting on expense cuts to make up for slow revenue growth and make room for higher payouts. About 40 percent of the legal and litigation outlays arose since January 2012, and banks are warning the tally may surge as regulators, prosecutors and investors press new claims. The prospect is clouding outlooks for stock prices, and by some estimates the damage could last another decade.

    “They’ve crossed the point of no return when it comes to the effects that these expenses are going to have on earnings,” said Jeffrey Sica, who helps oversee more than $1 billion as head of Sica Wealth Management LLC in Morristown, New Jersey, and doesn’t recommend bank stocks. “This is going to keep on hurting them, and people will start paying more attention.”

    JPMorgan and Bank of America bore about 75 percent of the total costs, according to the figures compiled from company reports. JPMorgan devoted $21.3 billion to legal fees and litigation since the start of 2008, more than any other lender, and added $8.1 billion to reserves for mortgage buybacks, filings show.

  2. ===============
    Interesting; criminal probes against JPM.

    That is suprising, Ctigroup mabe the runt of the lltter with bank fines,LOL:D That just goes to show you , not only is bank prediction almost impossible, to try to predict who the biggest crook is;
    a tough call,2:cool: