SEC Requests Subprime Mortgage Docs from National City

From a story published in the Louisville Courier-Journal:
“The Securities and Exchange Commission (SEC) has requested documents from National City Corp. relating to the sale of its former subprime mortgage unit and other matters as part of an informal probe, the regional bank revealed Friday in a regulatory filing…

National City spokeswoman Kelly Wagner Amen would not comment on the nature of the probe or whether it would financially affect the company. But she did say it would not impact customer accounts, and that the SEC has not said that National City has acted improperly or illegally. National City said it intends to cooperate with the SEC…

Merrill Lynch & Co. agreed to acquire First Franklin for $1.3 billion at the height of the real estate boom in late 2006. But the collapse of the subprime mortgage market and the deterioration of the credit market led Merrill to announce in March that it would stop funding loans at the unit and pursue a sale of the business.”

We are likely to see a lot more of this back-and-forth between banks and the SEC or other regulators as banks attempt to cabin their losses from the subprime crisis and regulators try to ensure accountability.

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