Mortgage, Toxic Assets | featured news

A Manhattan federal judge on Monday signaled he will not rubber-stamp Citigroup Inc's proposed $590 million settlement of a shareholder lawsuit accusing it of hiding tens of billions of dollars of toxic mortgage assets.

The Obama administration launched a broad government effort this week to overhaul mortgage giants Fannie Mae and Freddie Mac and is considering splitting the companies and putting their troubled assets in a new federally backed corporation, administration officials said.

The board that sets U.S. accounting standards voted to adopt guidelines that could reduce the losses banks have been forced to report as the values of their securities have crumbled.