Goldman deal with federal agency may reach US$1.25bil

Goldman is said to be discussing a settlement with the Federal Housing Finance Agency. - EPA

NEW YORK: A deal to resolve a US regulator’s claims against Goldman Sachs Group Inc over mortgage-backed securities sold to Fannie Mae and Freddie Mac leading up to the financial crisis could cost the bank between US$800mil and US$1.25bil, a source said.

The source said that Goldman was discussing a settlement with the Federal Housing Finance Agency (FHFA), which filed 18 lawsuits against Goldman and other banks in 2011 over about US$200bil in mortgage-backed securities that later went sour.