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Lehman Brothers

Fannie to get about $537M in deal with Lehman

The Associated Press

WASHINGTON (AP) — Lehman Brothers Holdings has reached a settlement with Fannie Mae that would allow the mortgage finance giant to recover about $537 million for its claim against the estate of the failed Wall Street bank over soured mortgage securities.

Fannie Mae headquarters  in Washington.

The settlement announced Thursday must be approved by a federal bankruptcy judge. It valued Fannie's claim over home loans and mortgage securities it bought from Lehman before the financial crisis at about $2.15 billion. But under Lehman's bankruptcy proceeding Fannie would get about 25% of that.

A Fannie official called it a fair outcome.

Fannie and sibling Freddie Mac were rescued by the government in a $187 billion bailout after they were hit by massive losses on high-risk mortgages.

Lehman's bankruptcy was the biggest in U.S. history.

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