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Dutch pension scheme ABP settles with JPMorgan

11 December 2012

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Dutch pension fund Stichting Pensioenfonds ABP has reached agreement with JPMorgan Chase & Co. (JPMC) to settle claims regarding residential mortgage-backed securities.

The fund purchased these securities (RMBS) from certain affiliates of JPMC; Bear Stearns and Washington Mutual Bank in 2006 and 2007.

ABP says the settlement, of which the figure has not been disclosed, resolves all litigation between ABP and JPMC regarding the investments.

In its claim, filed almost exactly a year ago in December, ABP alleged that it had purchased certain RMBS in reliance on false and misleading statements and that these securities were far riskier than had been represented, backed by mortgage loans worth significantly less than had been represented.

In the court's official documents, ABP, which has over €270bn in assets according to data held by Pension Funds Online,said it was basing its evidence for alleged misleading practices from JPMorgan on information from its own investigation. This, the fund says, includes a review and analysis of annual reports and publicly filed documents, reports of governmental investigations, as well as press releases, news articles, analysts' statements, conference call transcripts, and transcripts from speeches and remarks given by the defendant.

JPMC has denied and continues to deny all claims.

ABP says now it is "very content to have reached this settlement" and is "pleased that JPMC was willing to reach a mutually satisfactory conclusion of this litigation".

In this case ABP was represented by APG Asset Management and the U.S. law firm Grant & Eisenhofer P.A.

ABP one of the top three pension funds in the world in terms of size and looks after 2.8 million participants.

First published 11.12.2012

azeevalkink@wilmington.co.uk