JPMorgan Chase & Co. and Morgan Stanley have agreed to repurchase a combined $7 billion in auction-rate securities as part of a settlement with New York Attorney General Andrew Cuomo and other regulators.
The companies will also pay a combined $60 million in fines.
Last week, regulators reached settlements that required Swiss bank UBS (UBS) to repurchase $18.6 billion in the securities, while Citigroup (C, Fortune 500) agreed to buy back $7 billion of the securities.
Auction-rate securities are investments that resembled corporate debt, but with interest rates reset at regular auctions instant payday loan payday loans lenders.
The market for the securities collapsed in February amid deterioration in the broader credit markets.
Shares of JPMorgan (JPM, Fortune 500) still rose 2.5% and Morgan Stanley (MS, Fortune 500) rose 1.5% in morning trade.
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