Five of the largest U.S. banks have provided $19 billion in mortgage debt write-downs to some 240,000 borrowers under the terms of a federal and state settlement of foreclosure-processing violations reached one year ago, according to a watchdog's report released today, the Wall Street Journal reported. Bank of America Corp., which was required to provide the majority of relief under the foreclosure pact, has accounted for the lion's share of principal write-downs, with about $13.5 billion in homeowner debts written off. The Charlotte, N.C.-based lender reported that another $2.2 billion in loan forgiveness modifications were in a trial stage as of Dec. 31. The figures released today by the independent monitor were established to ensure that banks were meeting the terms of their deal. Today's figures were reported by the banks to the monitor, Joseph A. Smith Jr., earlier this month and have not yet been independently verified by his office. Under the settlement, completed last March, banks must provide at least $10 billion in loan write-downs and $10 billion in other homeowner aid, such as short sales, where banks allow borrowers to sell their house for less than the amount owed. Overall, the report said that banks had provided various forms of aid worth $45.8 billion to more than 550,000 borrowers.
