Four Banks Sued Over RMBS Losses

Germany’s Commerzbank AG has filed lawsuits against a quartet of U.S. over more than $2 billion in losses related to residential mortgage-backed securities (RMBS) issued between 2005 and 2007.

The Wall Street Journal, citing court documents that it viewed in U.S. District Court, is reporting that Commerzbank has targeted Bank of New York Mellon Corporation, Wells Fargo NA and HSBC Bank USA NA, plus Deutsche Bank AG ’s U.S. unit, Deutsche Bank National Trust Company in its litigation, charging that the banks did not monitor losses on the securities for which they acted as Commerzbank’s trustees. Commerzbank accuses the banks of failing the fulfill their respective “contractual and fiduciary duties.”

Each bank is the subject of a separate lawsuit filed on Dec. 23 and Dec 24 in the U.S. District Court for the Southern District of New York. Commerzbank made no public announcement of the lawsuit and the four banks being sued have not issued public comments on the litigation.