Credit Suisse has agreed a $600m settlement to end a long-running mortgage bond lawsuit just months after the bank said it had strong grounds to appeal a court ruling in favour of financial services group MBIA.

“We are pleased to have resolved this legacy matter, which dates back to 2007,” said Credit Suisse, which is due to report fourth-quarter earnings next Thursday.

The bank added that the settlement was “substantially less” than its previous guidance for a settlement up to about $680m and was fully covered by the $850m of litigation provisions it announced for the fourth quarter of 2020, which was intended to cover the costs of a string of cases related to the bank’s sale of residential mortgage-backed securities (RMBS) a decade ago.

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