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Item 8.01 Other Events.

Repurchase Request Resolution Agreement

On January 6, 2013, Fannie Mae (formally, the Federal National Mortgage Association) entered into an agreement (the “resolution agreement”) with Bank of America, N.A., Countrywide Home Loans, Inc., and other parties, each of which is an affiliate of Bank of America Corporation, to resolve certain repurchase requests arising from breaches of selling representations and warranties. Bank of America Corporation acquired Countrywide Financial Corporation and its subsidiaries (collectively, “Countrywide”) in 2008. In this report, Bank of America Corporation and its affiliates are referred to individually and collectively as “Bank of America.”

Our mortgage seller/servicers are obligated to either repurchase loans or foreclosed properties, or reimburse us for our losses, if we determine that the mortgage loans did not meet our underwriting, eligibility or other requirements in place at the time we acquired the loans. We refer to our requests to seller/servicers to honor these obligations collectively as “repurchase requests.”

The resolution agreement resolves Fannie Mae’s currently outstanding and expected future repurchase requests arising from breaches of selling representations and warranties on specified single-family loans delivered to Fannie Mae by Bank of America and Countrywide that were originated between January 1, 2000 and December 31, 2008. These loans had an outstanding unpaid principal balance of $297 billion as of November 30, 2012. Fannie Mae entered into the resolution agreement to compensate us for actual and projected losses resulting from the loans covered by the agreement that did not meet our underwriting requirements.

Bank of America will pay Fannie Mae approximately $10.3 billion pursuant to the resolution agreement, as follows:



Bank of America will make a cash payment to Fannie Mae of $3.55 billion; and



Bank of America will repurchase approximately 30,000 loans from Fannie Mae with an unpaid principal balance of $6.51 billion as of November 30, 2012, plus accrued interest, for an aggregate repurchase price of approximately $6.75 billion, subject to adjustment for loans that have been liquidated or paid off prior to the date of repurchase and for additional accrued interest. The table below displays certain risk characteristics of the loans Bank of America is repurchasing. The amounts in the table represent the outstanding unpaid principal balance of the loans in each category as of November 30, 2012.


     Categorized By Estimated Mark-to-Market Loan-to-Value Ratio(1)  
     <= 80%      80.01% to
     100.1% to
     > 125%      Total  
     (Dollars in millions)  


   $ 8       $ 5       $ 2       $ 1       $ 16   

Modified (current)

     320         726         783         892         2,721   

Modified (30 days or more delinquent)

     464         605         374         383         1,826   

30 to 89 days delinquent(2)

     12         8         3         1         24   

90 days or more delinquent(2)

     886         630         245         157         1,918   

















   $ 1,690       $ 1,974       $ 1,407       $ 1,434       $ 6,505   


















The aggregate estimated mark-to-market loan-to-value ratio is based on the unpaid principal balance of the loans as of November 30, 2012 divided by the estimated current value of the property. Includes loans that have been liquidated or paid off prior to the date of repurchase.


Excludes modified loans.