The Week-end Stock Pot Watch, Thursday, November 28th-December 1st. Holiday Edition!

[Demeter]

59. US banks could face legal charges of over $100 billion

http://www.cnbc.com/id/101231303

The fallout from the subprime mortgage crisis continues to plague U.S. banks, according to Standard and Poor's, with the ratings agency estimating billions of dollars in extra litigation fees may hit major lenders.

In the lead-up to the financial crash of 2008, U.S. banks packaged and sold residential mortgage-backed securities - a type of financial instrument that contained mortgages and home-equity loans of varying risk. Once homeowners in the U.S. started defaulting on their loans in record numbers in 2007, the market for mortgage backed securities collapsed as it became impossible to tell whether the debt in the security was high- or low-risk, sparking the global financial crisis...

"We estimate that the largest banks may need to pay out an additional $55 billion to $105 billion to settle mortgage-related issues," Stuart Plesser, a credit analyst at the ratings agency said in a press release late on Tuesday.

The banks included in the report are Bank of America, Citigroup, Goldman Sachs, JPMorgan Chase, Morgan Stanley, and Wells Fargo...