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NEW YORK – Bank of America Corp. reached a $2.8 billion settlement with Fannie Mae and Freddie Mac over claims that one of its businesses sold bad mortgages. The payment is far lower than analysts expected and removes some uncertainty that has hovered over the bank.
"The government gave Bank of America a very attractive deal," said Christopher Whalen, managing director of Institutional Risk Analytics.
Bank stocks rallied on the news, with Bank of America up more than 6 percent and Wells Fargo up 2 percent. Other settlements are likely soon