And the beat goes on, with yet another suit against Bank of America - this one related to a $1.75bn Countrywide mortgage pool.  U.S. Bancorp, the trustee of the $1.75bn mortgage pool, is looking to have BofA buy back the underlying loans because of alleged misrepresentations in how they were made.

In its complaint filed in a New York state court in Manhattan, U.S. Bancorp said Countrywide, which issued the 4,484 loans in the HarborView Mortgage Loan Trust 2005-10, materially breached its obligations by systemically misrepresenting the quality of its underwriting and loan documentation.

Soon after the loans were sold to the trust, they "began to become delinquent and default at a startling rate," according to the complaint.  Out of a sample of 786 of the loans, 520, or 66%, allegedly breached one or more representations. 

U.S. Bancorp Prior Effort to Settle.  U.S. Bancorp said it demanded that Bank of America fix the breaches or buy back the loans as it had agreed to do.  So far, BofA has refused and offered no reason for this refusal.

BofA's Countrywide Ledger Page.   So far, BofA's investment in Countrywide has been under water.  After paying $2.5bn, BofA has over $30bn in writedown and legal costs.  The number continues to rise.  BofA CEO Chief Executive Brian Moynihan said late last year that the bank would fight repurchase claims by investors, calling the process "hand-to-hand combat."

The case is:   U.S. Bank National Association, as Trustee for HarborView Mortgage Loan Trust v. Countrywide Home Loans Inc et al, New York State Supreme Court, No. 652388/2011.    [ThomsonReuters, 8/30/11]