Goldman Sachs Group Inc and Morgan Stanley will pay a total of $557 million in cash and other assistance to troubled borrowers to end a case-by-case review of past foreclosures required by U.S. regulators.
The U.S. Federal Reserve said on Wednesday that the two banks will pay $232 million to eligible borrowers and $325 million in loan modifications and forgiveness.
The agreement is similar to an $8.5-billion deal agreed between the Fed, the Office of the Comptroller of the Currency, and 10 other bank servicers on Jan. 7.
The deals help the financial industry move a step closer to ending the housing crisis-related problems that have dogged it for years.
Morgan Stanley's portion of the settlement is $227 million, according to a person familiar with the agreement, including $97 million in cash and $130 million in the other measures. Goldman will pay $330 million, with $135 million in cash and $195 million from the other pot.
The Fed had previously ordered
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