Bondholders Order Investigation of $26B in Countrywide RMBS

The Houston-based law firm ""Gibbs & Bruns LLP"":http://www.gibbsbruns.com says its institutional investor clients have issued binding instructions to Bank of New York, serving as trustee, to[IMAGE]

open an investigation of ineligible mortgages behind more than $26 billion of residential mortgage backed securities (RMBS) issued by subprime lender ""Countrywide"":http://www.bankofamericahomeloans.com.

The holders of more than 25 percent of the voting rights of the RMBS have the power to issue binding instructions to the trustee to investigate ineligible mortgages, according

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to the terms of the applicable pooling and servicing agreements (PSAs). The investors can then demand the repurchase of mortgages that did not conform to the required representations and warranties at the time they were used as collateral for RMBS.

""We believe our clients' instruction and the terms of the applicable PSAs require the trustee to take action on each of these transactions,"" said Gibbs & Bruns LLP partner, Kathy Patrick, lead counsel for the bondholders. ""Our clients will pursue all contractual remedies available to them in these and the many other Countrywide RMBS deals where they have instructed us to take action to protect their rights and recover their losses.""

Gibbs & Bruns said in a statement that instructions to the Countrywide RMBS trustee included a list of securities to be investigated and the steps the trustee should take while investigating.

""Bank of America"":http://www.bankofamerica.com, which acquired what was once the largest subprime lender in the country in July of 2008, has already been forced to pay out hundreds of millions of dollars to settle lawsuits stemming from Countrywide's business prior to the acquisition.