Goldman, Morgan Stanley Agree to $557 Million Mortgage Settlement

Up to 220,000 borrowers affected

Goldman Sachs Group Inc and Morgan Stanley will pay a total of $557 million in cash and other assistance to troubled borrowers to end a case-by-case review of past foreclosures required by U.S. regulators.

The U.S. Federal Reserve said on Wednesday that the two banks will pay $232 million to eligible borrowers and $325 million in loan modifications and forgiveness.

The agreement is similar to an $8.5-billion deal agreed between the Fed, the Office of the Comptroller of the Currency, and 10 other bank servicers on January 7.