By Olivia Bugault
Credit Suisse Group AG said Tuesday that it may have to pay up to roughly $680 million as part of a decadelong legal dispute with financial services company MBIA Inc. related to U.S. residential mortgage backed securities, known as RMBS.
"Last night, the judge presiding over this legacy case issued an order requiring both parties to submit estimates of damages in respect of these mortgages which could result in a judgment against Credit Suisse of up to approximately $680 million," the Swiss bank said.
Credit Suisse had previously taken $300 million of provisions in relation to this case and will likely increase provisions, it said. However, the bank also believes that it has "strong ground" to appeal.
MBIA first filed a lawsuit in New York against Credit Suisse in 2009 and both companies have been in a legal dispute in respect of warranties regarding a U.S. RMBS since then.
Write to Olivia Bugault at firstname.lastname@example.org