Goldman Sachs thinks the value of its latest mortgage practices settlement is $1.5 Billion. That is the amount by which Goldman will reduce its 4Q earnings in 2015.
After taxes.
E.g., Matthew Goldstein, "Dealbook Online / Goldman to Pay Up to $5 Billion to Settle Claims of Faulty Mortgages" (New York Times Online, posted on January 14, 2016); Ken Sweet Associated Press Copyrighted Report published in Washington Post Online, "Business / Goldman Sachs to Pay $5 Billion in Mortgage Settlement" (Online January 14, 2016).
Since banks settle their mortgage practices exposure for about 2% of the money they take in from marketing, selling, and servicing their mortgages portfolio, we can reasonably assume that Goldman's take was about $75 Billion for the period in question, which is 2005 to 2007. That's an informed calculation, a reasonable estimate, of course.
The press has not said how much money Goldman took in from its mortgage practices in 2005 to 2007. That figure was probably not in Goldman's press release.
Please Read The Disclaimer. ©2016 by Dennis J. Wall, author of "Lender Force-Placed Insurance Practices" (American Bar Association 2015). All rights reserved.
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