Bank of America Corp. should repurchase up to $20 billion in home loans that were based on wrong or missing information, said a trade group for bond insurers.
More than half the soured home equity credit lines and residential mortgages originated from 2005 through 2007 that insurers examined should be bought back, the Association of Financial Guaranty Insurers said in a Sept. 2 letter to Bank of America Chief Executive Officer Brian T. Moynihan. MBIA Inc., Ambac Financial Group Inc. and Assured Guaranty Ltd. are members, and the association said repurchases tied to the group may total $10 billion to $20 billion.
Bank of America has said it faces $11.1 billion of unresolved claims, which it reviews on a "loan-by-loan" basis.
"This defensive posture will soon prove ineffective in shielding Bank of America from the financial, accounting, legal and other implications of its massive obligations to our industry members," Teresa Casey, the association's executive director, said in the letter.
Bank of America declined to comment, said Jerry Dubrowski, a spokesman for the Charlotte banking company. The lender has not yet responded to the insurer group, Casey said Monday in a telephone interview.
