BBT has received subpoenas from the Justice Department tied to a probe of the Winston-Salem, N.C., company’s FHA lending.
The subpoenas, sent in November and December, sought additional information on behalf of the Department of Housing and Urban Development’s inspector general, which in June sent a letter telling the company it had been selected for an audit of its compliance with FHA rules.
BBT is in the process of responding to the subpoenas, the $187 billion-asset company said in its 10-K filing with the Securities and Exchange Commission on Wednesday. MarketWatch reported the disclosure earlier in the day.
BBT last year set aside $85 million after identifying “a potential exposure to losses incurred by the FHA on defaulted loans” that ranges from $25 million to $105 million. The company had reported the $85 million charge and the HUD IG’s inquiry in previous filings.
HUD and the Justice Department have not issued any charges, but “similar reviews and related matters with other financial institutions have resulted in cash settlements and other remedial actions,” BBT said in the filing Wednesday.