Bank of America facing the demands of institutional investors to buy back billions of dollars in soured mortgages

Bank of America Corp., facing the demands of institutional investors to buy back billions of dollars in soured mortgages, said some bondholders will delay the action carried out "constructive" discussions.

"Some investors" agreed to extend the time limits set forth in a letter dated 18 October, the bank said in a statement, without identifying them. Companies such as Pacific Investment Management Co., BlackRock Inc. and Federal Reserve Bank of New York had demanded the repurchase of bank loans packaged into 47 billion U.S. dollars of bonds by Countrywide Financial Corp. unit, people familiar with the letter, said at the time.

"The expansion will continue as long as the parties involved in a constructive debate," said Jerry Dubrowski, a bank spokesman in Charlotte, North Carolina based. "As we've said all along, if you have a valid claim, we will act responsibly. If there is no defect, we will defend our interests and the interests of our shareholders."

CEO Brian T. Moynihan said in November that the bank would take on the "hand to hand combat" to defend against unjustified demands to repurchase shares of Fannie Mae and Freddie Mac, and bond insurers and private investors who want to return loans. Putback outstanding claims amounted to 12.9 billion U.S. dollars to 30 September $ 7,700,000,000 at the end of 2009, the lender said.

Parties in the talks

MetLife Inc., the largest U.S. insurer life is also part of the investment group BlackRock, the largest money manager, and Pimco, which manages the largest bond fund, said people familiar with the matter in October. They are represented by Gibbs & Bruns LLP.

The agreement announced today was reached between the home unit of the bank service, Gibbs and Bruns, and Bank of New York Mellon Corp., trustee of the debt, according to Bank of America statement.

"The claims and defenses of all parties are kept" the company wrote in a statement.

The bank rose 31 cents, or 2.5 percent, to $ 12.60 in electronic trading at 5:32 pm in New York.