Nomura will defend claims by a U.S. regulator that it sold defective mortgage-backed securities to Fannie Mae and Freddie Mac before the 2008 financial crisis, becoming the first bank to take such a case to trial.
The agency seeks more than $1bn in damages in the trial, which is set to start Monday in Manhattan federal court.
Nomura is choosing to fight claims that 16 other banks settled after the blow-up of toxic mortgage bonds led to the global credit crunch. FHFA has reached $17.9bn in settlements from banks including Bank of America, JPMorgan and Goldman Sachs. If Nomura prevails at trial, it may embolden other firms facing mortgage-related suits to defend themselves rather than settle.
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