NEW YORK (TheStreet) -- Shares of bond insurer MBIA
jumped 5% following a landmark ruling that may give the company an upper hand in its long-running dispute with Bank of America
over failed mortgage-backed securities.
Judge Jed Rakoff on Tuesday ordered Flagstar Bancorp to pay bond insurer Assured Guaranty $90.1 million in damages in a dispute over souring mortgage-backed securities valued at more than $900 million.
Assured Guaranty, which provides lenders insurance against defaults, had sued Flagstar over two securitizations, alleging the bank had misrepresented the quality of the loans underlying the mortgage-backed securities.
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