(Reuters) – Bond insurer MBIA Inc and Bank of America Corp have reached a settlement in an ongoing legal dispute, and BofA will pay MBIA $1.6 billion, sources familiar with the matter said on Monday.
Bank of America will also provide MBIA with a $500 million credit line and receive a 4.9 percent stake in the company as part of the deal, said one of the sources.
MBIA shares, which were temporarily halted, rose 50 percent in afternoon trading to their highest since September 2008.
Representatives of the two companies were not immediately available to comment.
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