The $8.5 billion Countrywide/Bank of America settlement is set to have its final hearing on May 2, 2013, Barclays Capital analysts reported, citing a recent court filing.
This court document shows the agreed upon schedule for the discovery process and the hearings. This schedule specifies the dates and somewhat increases the timing certainty of the proceedings. Barclays analysts still believe that the cash can be paid out in 2H13, most likely late 3Q13 or 4Q13.
However, they said that there are still at least three issues that could delay the process. Even if the court grants approval, either AIG or the other intervenors can file an appeal that might delay the process another year or more.
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The settlement requires the Internal Revenue Service and New York/California state tax authority approvals before the cash can be paid out. These should be requested within 30 days of signing, analysts explained.
After all these approvals have been received, BofA has an added 120 days where it has to disburse the $8.5 billion in cash, they said.
Overall, Barclays analysts still believe that the cash can be paid out in 2H13, most likely late 3Q13 or 4Q13.