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Top Subprime Lenders Owned by Bailout Banks
Analysis of gov't data reveals sources of the economic meltdown
By Katherine Thompson
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Posted May 6, 09 9:28 AM CDT
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(Newser)
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Some 21 of the top 25 subprime lenders that triggered the global economic collapse were either owned or financed by banks that ended up needing bailouts, an analysis by the Center for Public Integrity finds. Among the backers, who make huge profits on the subprime business, were Lehman Brothers, Merrill Lynch, JPMorgan, Citigroup, Goldman Sachs, and AIG.
The center's analysis of 7.2 million subprime mortgages shows that the top 25 originators account for about 72% of the high-risk loans. Twenty of the top 25 subprime lenders were found to have closed, been sold, or stopped lending. Eleven paid out claims to settle lawsuits alleging lending abuses.