JPMorgan will pay $995m to end two lawsuits the New York-based insurer filed in 2011 and 2012 over the quality of loans underlying mortgage bonds sold by Bear Stearns & Co., which had been bought by JPMorgan in 2008.

Clearing the way

Ambac has also agreed to drop its objections to a $4.5bn settlement between JPMorgan and institutional investors over claims of faulty home loans, which leaves only one objector to the pact. Bloomberg Intelligence analyst Elliott Stein believes this clears the way for a judge to approve the larger deal.

Bank of America

Investors have been focused on whether Ambac would be able to resolve similar claims against Bank of America; the question now is whether the balance of power has shifted in Ambac’s talks with the bank and if the JPMorgan settlement will lead to a resolution of that case. Source: Bloomberg BNA