UBS in settlement with US over mortgages

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GENEVA (AP) — Swiss banking giant UBS AG says it has reached "an agreement in principle" to settle a U.S. lawsuit over billions of dollars in mortgage bonds.

The U.S. Federal Housing Finance Agency, which was created in July 2008, sued UBS and 17 other banks in 2011 over some $200 billion mortgage securities sold to Fannie Mae and Freddie Mac, two U.S. agencies that provide funding for housing.

The Zurich-based bank also said Monday that its net profit jumped 62 percent in the second quarter of the year to 690 million francs ($734 million), up from 425 million francs in the same period a year earlier. UBS said it was making progress with its strategic overhaul.

The basic results were released unexpectedly, a week ahead of the planned second-quarter report.

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