JPMorgan Chase agreed to drop litigation against the Federal Deposit Insurance Corp. over some mortgage bonds sold by
The settlement could be announced as early as tomorrow, said the person, requesting anonymity because the negotiations aren't public.
JPMorgan, the biggest U.S. bank by assets, battled with the FDIC over who should pay some liabilities from the failed Seattle thrift, which the agency placed into receivership in 2008 while selling assets to New York-based JPMorgan.
The agreement, which is being brokered by the Justice Department, won't interfere with JPMorgan's ability to sue the FDIC to cover part of a $4 billion settlement last month with the Federal Housing Finance Agency, two people familiar with the matter said.
It also won't prohibit the bank from seeking reimbursement from the FDIC for claims against WaMu from private investors, they said. JPMorgan announced a tentative $4.5 billion deal with 21 institutional investors, including Pacific Investment Management Co., last week to settle claims that the lender and its subsidiaries sold faulty mortgage bonds.
The broader settlement, which includes a $2 billion fine, will end civil investigations by the Justice Department, the California and New York state attorneys general, as well as lawsuits by the FDIC and National Credit Union Administration, people briefed on the talks said.
Andrew Gray, a spokesman for the FDIC, and JPMorgan's Brian Marchiony and Brian Fallon at the Justice Department said they couldn't comment because the negotiations are confidential.
