People's Bank said late Tuesday that it has settled a class action filed against it in 1990.

The settlement, which needs court approval, will cost the $10.4 billion-asset thrift about $250,000 in the third quarter, it said.

The suit accused People's of not making adequate provisions for losses in the late 1980s. People's agreed to pay $7.7 million in the settlement -- most of which will be covered by insurance -- but admitted no wrongdoing.

"We believe there is benefit to be gained for our shareholders in obtaining final resolution and putting this litigation to rest," said David E.A. Carson, People's chairman and chief executive officer. "The settlement achieves this result." -- Louis Whiteman

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