McGraw Hill Financial Inc. and its subsidiary Standard & Poor's Ratings Services have agreed to pay a total of $1.375 billion to settle lawsuits related to residential mortgage-backed securities and U.S. collateralized debt obligation ratings that S&P issued from 2004 to 2007.
The settlements resolve a lawsuit by the Department of Justice filed in early 2013, and lawsuits filed by the attorneys general of 19 states and the District of Columbia, said an S&P news release e-mailed by spokeswoman Catherine Mathis.
The company will pay $687.5 million to the DOJ and a total of $687.5 million to the states and District of Columbia.
The state of California will receive $210 million of the total, Attorney General Kamala Harris' office said in its news release. The state's two largest pension funds will receive portions of that total.
CalPERS will receive about $176 million, a news release from the pension fund said. The $296.5 billion California Public Employees' Retirement System, Sacramento, will also receive another $125 million in a separate settlement regarding ratings on three separate investment vehicles that also collapsed during the financial crisis. Details regarding those three vehicles were not divulged by either CalPERS or S&P.
The $188.8 billion California State Teachers' Retirement System, West Sacramento, meanwhile, will receive $23 million of the state's total, CalSTRS spokeswoman Michelle Mussuto said.
Illinois will receive $52.5 million of the total, Attorney General Lisa Madigan's office said in a news release, which did not provide information how much the state's pension funds will receive.
Ms. Mathis referred questions to the settlement agreement posted on the DOJ's website.
Joe DeAnda, CalPERS spokesman, and Maura Possley, Ms. Madigan's press secretary, did not return phone calls by press time.