Bank of America and U.S. Bancorp reached a $69 million settlement with a group of pension funds over charges that the banks failed to protect investors from financial crisis-era losses.
Under the terms of the agreement, filed Friday in the U.S. District Court of the Southern District of New York, Bank of America will pay the full cost of the settlement on behalf of both banks. The funds will be placed into an escrow account, which will be used to pay claims.
The class-action lawsuit was filed in April 2012 by the Policeman's Annuity & Benefit Fund of the city of Chicago. The suit charged the two banks with failing to provide proper oversight of several trusts that issued securities backed by bad mortgages. The extent of the losses was not immediately clear from the filings.
The securities in question were originally sold by Washington Mutual, which failed at the height of the mortgage crisis and is now part of JPMorgan Chase.
Spokespeople for both banks declined to comment on the settlement. Attorneys representing the banks did not immediately respond to requests for comment.