U.S. subprime settlements averaging $116 million

Recent settlements in the United States as a result of subprime and credit crisis litigation are averaging $116 million, although only a small number of cases have been settled over the past five years, according to Kevin LaCroix, writing for the November 2011 edition of the PLUS Journal.
LaCroix’s article lists a number of securities litigation settlements arising out of the credit crisis, the largest of which was the $627-million Wachovia bondholders settlement. Other settlements listed in the article include:
•Washington Mutual: $208 million
•Wells Fargo Mortgage Backed Securities: $125 million
•National City: $168 million
•Colonial Bank: $10.5 million
•Lehman Brothers executives: $90 million.
“With these latest settlements (many of which are subject to court approval), there have been (as of Sept. 2, 2011) a total of 29 settlements collectively representing a total of almost $3.4 billion, for an average settlement of $116 million (although that average is obviously skewed upward by the $627 million Wachovia bondholders settlement and the $624 million Countrywide shareholders settlement),” LaCroix wrote. “As impressive as these cumulative numbers are, there are still many more cases pending.”
LaCroix says the “possibilities may have significant implications for D&O insurers.”