Fifth Third Bancorp (FITB) in Cincinnati has agreed to pay $25 million to Freddie Mac to resolve mortgage repurchase claims.

The agreement applies to mortgage loans originated and sold to Freddie Mac before Jan. 1, 2009, according to Fifth Third's Monday press release. The $126 billion-asset Fifth Third has sufficient reserves to cover the payment amount, according to the release.

Earlier this month, Fifth Third reached a tentative agreement with the Securities and Exchange Commission to settle an investigation into its accounting for commercial real estate loans in 2008. The company named a new chief credit officer in connection with the settlement. It would also pay a civil money penalty of an undisclosed amount as part of the deal.

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