Pension360 has previously reported that CalPERS was due to receive a substantial sum of money from a settlement with Bank of America, stemming from a lawsuit over failed mortgage securities the bank sold investors.
This week, the dollar figure was solidified: CalPERS has announced it will receive a $249.3 million payout from the bank.
More from the Sacramento Bee:
CalPERS said Monday it has received a $249.3 million payment from Bank of America, the result of a settlement over toxic mortgage securities purchased by the pension fund during the housing bubble.
With the Bank of America settlement, the California Public Employees’ Retirement System said it has now recovered more than $500 million from its investments in bad mortgage securities.
“This is money that rightfully belongs to our members for their long-term retirement security,” said CalPERS Chief Executive Anne Stausboll in a prepared statement. “We’re glad that those who misled investors about the risks of mortgage-backed securities continue to compensate our members for their losses.”
In mid-September, CalPERS collected $88 million from Citigroup Inc. over similar investments.
The payout from Bank of America is in line with CalPERS’ earlier estimate of its share of a $16.6 billion settlement the bank made with federal authorities in August.
The full, albeit brief, statement from CalPERS CEO Anne Stausboll:
“This is money that rightfully belongs to our members for their long-term retirement security,” said Anne Stausboll, Chief Executive Officer for CalPERS. “We’re glad that those who misled investors about the risks of mortgage-backed securities continue to compensate our members for their losses. We thank the California Attorney General’s Office and the U.S. Department of Justice for their diligent efforts.”
CalSTRS will also receive $50 million.