Forced repurchases of soured U.S. mortgages may be the "biggest issue facing banks" even as errors in the foreclosure process draw attention to other industry risks, according to JPMorgan Chase & Co. analysts. Future losses from repurchases of home loans whose quality failed to meet sellers' promises will likely total $55 billion to $120 billion, or potentially $10 billion to $25 billion for the next five years, mortgage-bond analysts led by John Sim and Ed Reardon wrote in a report Friday.

While a "firestorm of news" sparked by some loan servicers' decisions to halt action on defaulted loans is drawing renewed attention to banks' mortgage-repurchase risks, the foreclosure issues themselves are mostly "process-oriented problems that can be fixed," the analysts wrote.

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